Answering in reverse to your questions. Yes, the rash could be a reaction. Also, this time of year in many parts the air gets drier so it could simply be dry air. Or, sensitivity to soap etc. If not too bad I'd simply watch, observe and mention at the next appointment.
Stage 0 is about as good as it can get. Most of us have gone through the initial 6 and some additional protocol. After 6 I believe the evidence shows having more is therapeutic. At the same time many eventually drop out to bigger reactions and sensitivity to completely finish extras. Perhaps the most popular 1 installation a week after 3 months for a year then every 6 months and repeat. I have seen one a month for 12 months after the first 6. My URO had me do 6, 6 off then 6 more. Everyone is different in grade and stage plus each of us have different tolerance to BCG.
Having follow up scopes is perhaps the most important in all of this. Nothing beats looking into to see what is going on.