Reconstituted powdered milk should be fine. If it was me I would use milk daily to get rid of it. That's something you can't do with chemicals, but I would be anxious about it. Since you can...I would.

what about putting powdered milk on the lawn in powdered form, and watering it in? I thought that would be easier.

Part of the benefit of liquid sprays is they stick to the surface of the plant and feed the 20 layers or so of invisible microbes living on the plants.

I've only tried spraying whole milk with an orhto sprayer at 3oz/gallon. I sprayed in the back as that was where it was the worst. The front has identical conditions but the red thread was less severe and I decided not to drag the hose and instead use that as a control. I have a red fescue/KBG lawn in a new development (not alot of shade).

We've had alot of rain in MA the last two weeks and temps have been in the low 40's to 60's (sometimes a high of 70).
The back is red thread free. The front has alot of red thread and areas that had a slight problem last year now have it again.

I will spray milk as soon as I can until then I have done some soil drenching. I will also spray the back again as it can only help and NE springs are wet and cold.

In my experience the redthread only attacks weak stands of grass. I am working on the soil in these areas with extra grains, UCG and some compost as it becomes available. I believe these areas also have alot of rock in it prohibiting root growth. I'm hoping that with a soft soil and hard winter freeze, the rocks will rise and can be removed. If I get sick of it, I may find a tool to dig out rock before it breaks my weedhound.