You're absolutely right in your suspicions. Sometimes a tumor on the kidney will not appear on the outside of the body, but other symptoms such as limping or even loss of use of a leg (or both) might occur. This happens when the tumor presses on certain nerves.
Since you're seeing an apparent tumor on the Uropygial gland, it makes even more sense. These symptoms and conditions are not uncommon as the result of vitamin A deficiency (largely seed diets).
Steroids and pain meds are possible prescriptions you can expect from a hands on vet visit; however, the Uropygial tumor needs the more aggressive treatment, possibly removal. The benefit of the oils from this gland is to act as an antibacterial, inhibiting the growth of various bacteria that may degrade the feathers - it's a pretty necessary gland.
Modifying your bird's diet, even at this point, won't be a bad idea. If he's on a seed diet, getting him more onto pellets is ideal. If he's on pellets already, chances are this has another causation which can be trickier to uncover.
I'm sorry you have to go through this. It's not easy when we see things like this in a valued companion.
It's never the same in any two birds. I've seen some progress rapidly (days) where others have lived over a year. The concern is your little buddy's pain level. Even though they don't show it (they are masters at hiding weakness, illness, pain). We have to know there's pain based on the condition they're presenting with, and this is one of them.
When it's time, you have to make the decision that's one of the most difficult and painful for us, but kindest for them.
Until then, maybe one or more of these options will help you.
American Animal Hospital Association http://www.aahahelpingpets.org/home The AAHA Helping Pets Fund helps with veterinary care for sick or injured pets, including those abandoned or with owners experiencing financial hardship.Angels 4 Animals http://www.angels4animals.org/ Services range from financial aid to complete treatment to those pets and pet owners in need. Care Credit http://www.carecredit.com/ A credit card company for health care, including veterinary care. From $1 to over $25,000, they offer a plan and a low monthly payment to fit comfortably into almost every budget.God's Creatures Ministry http://www.all-creatures.org/gcm/help-cf.html Fund helps pay for veterinarian bills for those who need help. Help-A-Pet http://www.help-a-pet.org/home.html Efforts focus on serving the elderly, the disabled, and the working poor.
IMOM http://www.imom.org/ Dedicated to insure that no companion animal has to be euthanized simply because their caretaker is financially challenged. The Pet Fund http://thepetfund.com/ The Pet Fund is a registered 501(c)3 nonprofit association that provides financial assistance to owners of domestic animals who need urgent veterinary care.
Ask your local Humane Society and/or ASPCA for help; and don't forget to contact your local pet stores. Oftentimes they have rescue orgs working out of them or with them and can offer you a list of numbers to call. Someone should have options in place for kind hearted people like you doing the right thing.