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It sounds like your cat has ringworm. You can go to the drug store and get some anti-fungal, like lamasil and use this on the areas that are crusty and this should clear up the problem. Some of the antifungals work faster than others....some you have to use for up to a month (read the directions on the box). Lotrimin Ultra is supposed to clear the fungal problems up in a week. You need to treat all the areas and wash thoroughly after treating them as ringworm is contagious to humans. If this doesn't help, you need to take your cat into the vet so they can culture the area and see if it is yeast or another type of fungus that may need additional treatment.
Please let me know if I can help further.
She has probably been harboring this for a while and you usually see it in cats that are very young (kittens) and older because the immune systems aren't as good as they could be. You can use the Equate and just wash your hands after applying it. The spores from the ringworm are in the environment so just watch your other cats for signs. Sometimes you will see it on the face or feet also. As long as she's not laying on your skin, you should be fine....if she's been sleeping with you all this time, you probably would have signs by now if you were going to get it. Young children are the most vulnerable. Adults don't seem to get it very often. You can use the anti-fungal on you if you see any spots.