Naxis

For just walking you don't really need "recovery" time as you would if you were running or strength training, but occasionally (maybe every couple of weeks) taking a day off can certainly help.
First, if you see yourself losing inches but not losing weight, this is a good sign. It means that you have gained some lean muscle and are losing fat. Even though it is slow going, if you stay consistent, I'd guess soon the scale will start to reflect your progress.
Second, you need to drink more water, less coffee and sugar-free (artificially sweetened) anything. Coffee dehydrates you, and while dehydrated, your body doesn't function optimally.
And although you didn't really mention what foods you eat (besides cereal) improving the content to as much whole, real food as you can will make a big difference. Oats instead of cereal, grilled or broiled chicken breast instead of deli meat, fresh fruits and veggies... that kind of thing. Even though you seem pretty restricted on your options for meal timing, having better meals may make a world of difference.
Also, does your treadmill have an incline setting? Adding just a 2 or 3% incline will make the walk more challenging and will burn more calories. Just monitor your breathing and if it aggravates your emphysema, then tone it back down.
So just making some small adjustments, I think you'll *see* some real progress. Just note that it's a slow process, but consistency will pay off.

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Keep your body lean, your blood clean and your mind sharp. -Rollins