Thinking about the 'madness' of Kellhus:
Old Moe's judgment that K is mad because he dreams of Mog is pretty weak. Moe can send dreams, Seswatha can communicate dreams, just being on the receiving end of some dreams should be irrelevant to someone's sanity status. Kellhus affecting to be convinced of the dreams ought to mean nothing to a Dunyain as well; Moe would KNOW that Kellhus' hides his true intentions.
But Kellhus should expect his father to be unfazed by his madness, so what does it mean to K that his dad is going through this elaborate and seemingly unnecessary pantomine? Perhaps M and K were acting out a script for someone else's benefit?
That Kellhus never contemplates the possibility of the Mog dreams originating from Moe or some other sorcerer seems significant to me.