I have a diabetic cat also and his name is Mow. For the longest time he wasn't doing well at all and was afraid I was going to loose him. So, I started reading anything and everything I could find on feline diabetes (FD). What I learned has been invaluable to his quality of life. He's going on 2.5 years of being diabetic and he's now doing great.
A couple of things:
When you said; "he walks around and around in circles and howls for no reason" this sounds very much like a hypoglycemic episode and is very dangerous and can even be fatal. If this happens again rub at least half a teaspoon of Karo syrup (actually anything loaded with sugar) on your kitty's gums. If the symptoms subside within 5-15 minutes that's probably what's happening. This fix is only good for less than a half hour until the sugar starts to wear off and the blood glucose begins to drop back down again. To avoid this your cat needs to eat, preferably something fairly high in carbs. Most any dry cat food will do. If your kitty is experiencing hypoglycemia, a serious look at insulin dosing and blood glucose values throughout the day need to be evaluated. Home glucose monitoring is your best tool, as vet stress can severely elevate blood glucose and not give you an accurate account of what is really happening.
Mow also suffered from neuropathy (usually exibited as hind leg weakness), walked on his hocks for months until he got regulated. It's very common and usually not nearly as serious as is it looks. It may not go away completly but it is reversable in most cases. This could account for why your kitty isn't using his litter box.
PLEASE feel free to contact me. I know how much you love your liittle guy and would hate to see him put down for something such as diabetes. It's a very treatable disease, even though sometimes you ( and possibly your vet as well) may feel at your wits end with it.
The protocol for treating FD has changed a lot in the last 5 or so years and so many vets (mine included) just aren't able to stay current on one specific disease that may comprise of only a very small fraction of thier clientel.
Another thing you could do is go to
http://www.felinediabetes.com There's tons of info there, as well as a very busy message board with some pretty educated folks to help you. Mow problably wouldn't be around today had I not found this site.
Sorry this got so long! I hope your kitty has many more happy and healthy years with you.
Barb~~