Here's the flange where the contractor would have expected dry rot. The floor board passed the 1/4 inch test - that is to say, that a knife point that penetrates into the wood to a depth of 1/4 inch is in need of replacing due to dray rot or water damage.

Any way, this is good news, there is no dry rot or water damage in the existing framework. The moldy smell must have come from the tile/cement board/drywall that was already removed.

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dry rot water damage