When you say "main terminals", are you talking about the main breaker terminals or the wires that attach to them? I can't tell if the wires going to the main are aluminum. If they are, then yes, you should use the antiox compound on the wires.
As far as applying to the terminals, you should have a new main breaker with the new panel, or do you plan on using the old main in the new?
As for the old wires, they do need to be cleaned up. I'd simply use several wraps of electrical tape on any broken insulation as a last resort. First being to splice new Romex with the old wires, where possible.
That panel is a mess. Try to run the new panel as neatly as possible.
What type is your new panel?
As far as applying to the terminals, you should have a new main breaker with the new panel, or do you plan on using the old main in the new?
As for the old wires, they do need to be cleaned up. I'd simply use several wraps of electrical tape on any broken insulation as a last resort. First being to splice new Romex with the old wires, where possible.
That panel is a mess. Try to run the new panel as neatly as possible.
What type is your new panel?