I feel my scalp is more flaky when I apply minoxidil? Can minoxidil cause/worsen flaking if I have dandruff.

Minoxidil can really dry out your scalp, so yes it can cause or worsen flaking in some people.

As a result of flaking I am losing more hair. I feel as if my scalp is on fire. Should I discontinue minoxidil or is there any other option. Will switching to minoxidil 2% help. Or as someone suggested I should use minoxidil with glycerol instead of propylene glycol. If yes, is there any such solution in the market?

I stopped using Rogaine (Minoxidil) a year ago. My scalp got really flakey and dry plus it didn't seem to be slowing down hair loss or re growing anything.
I cannot say if Minoxidil is the culpritbut, but since last year i have been suffering from Dermatitious in the exact same position of my scalp i used to apply Rogaine. I have been on 3 courses of Antobiotics and its nearly better (1 year later). Thats the reason why i stopped using Minoxodil. But don't let me influence you, everyones skin is different, and mine is really sensitive. You should see me after i have a shave.