Once it's confined behind the drywall, the irritant qualities of fibreglass are irrelevant. And despite the videos of the denim insulation companies, their product is not so warm and wonderful that you shouldn't also use gloves and masks when installing it.

Here is a link that might be useful: Cotton Insulation still doesn't work

After spending a week ripping stinky older fiberglass insulation from behind our basement walls, I really wouldn't recommend either for below-grade use -- they both absorb moisture, and the damp old fiberglass, at least, smells so gawdawful it's a living hazard.

I used the denim last year in the attic, and it was a dream to work with compared to the fiberglass. Use all precautions of course, but my experience was such that I'll never go back to fiberglass if I don't absolutely have to.

You can't add more foam or something else that's mold-proof?

More XPS or EPS (expanded polystyrene) fits the bill, as does rockwool. But in the wrong conditions, even XPS will support mould growth.

This post was edited by worthy on Thu, Mar 14, 13 at 17:03