This has been mentioned before in similar threads, but either shaving or a close trim can also help. I notice a huge reduction in chafing when I *ahem* mow the lawn. If your condition is as severe as it sounds, that could also assist with treating and healing, in that it could help to reduce sweat and bacteria in that area.

As for a cutout saddle, it probably depends on what sort of riding you intend to do. Saddles vary from big cushy comfort models to thin, practically non-existent racing models. Are you planning to ride your Xenith for fun and recreation, or do you intend to work up to long distances &/or racing? That'll have a lot of influence on your saddle choice.