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Dogs with dry skin are usually very itchy especially in the winter. Regularly bathing your dog with a good quality shampoois key to the overall health of their skin and coat. How often depends on your dog's skin, for a dog with dry skin, once a month is good. Using a harsh shampoo, one with lots of synthetic ingredients, or worse, human shampoo, strips your dog's skin of it's natural oils, causing dry skin and lots of itching.
The best type of shampoo to use on a dog with dry skin is a natural one containing Colloidal Oatmeal. Even better is to follow up with a good moisturizing rinse. Just as we use moisturizer on our skin to combat dry skin, a good moisturizing rinse will do the same for a dog's skin. I recommend using Nature's Specialties Colloidal Oatmeal shampoo and Colloidal Oatmeal Creme Rinse as I find them to be the best. The best way to use the Nature's Specialties shampoos is to dilute in warm water using a shampoo mixing bottle. This makes bathing easier and your shampoo last longer. It also allows even distribution of the shampoo and makes it much easier to lather correctly without over shampooing.
You can also follow up with Wham Anti-Itch Spray for those really itchy areas or for in-between baths.