>  I put on Apistan three weeks back
Pretty late in the season to put on Apistan; next year try earlier.  My
guess is that the Varroa got ahead of you.
 
>  some with a head of a bee just emerging (but dead).  When
>  I open a capped cell in this area, I find a nearly completely formed dead
>  bee.
A possiblity:  If you've had a spell of cold weather up there in yankee land,
its possible that your hand full of bees was inadaquate to keep the brood
nest warm, resulting in chill brood areas. (With the assumption that Varroa
was in fact the cause of the population dwindling).
 
My guess is that your queen is OK and the bees were trying to supersede
due to the stress caused by Varroa.  If your other hive is as strong as
you say, then I would pull some frames of eggs and try to strengthen the
weak colony (equalize the two).  If they attempt another supersedure, let
them.  After all, the new queen would be a product of the stronger colony.
If you try this, you may well have to continue feeding them for some time.
Good Luck!
 
BusyKnight
Dallas