Thanks for your question, and thanks for the photos. There are various rotting organisms that can affect the trunks of aging apple trees, and they usually enter through wounds that haven't entirely healed. Apple trees are highly susceptible to winter injury such as sunscald, frost cracks, animal browsing and other physical damage. An old wound on your apple tree appears to have been the entry point of wood-rotting fungi. Clean out the wound as best you can, scraping away soft and rotten wood, attempting to leave only sound wood. This will promote drying of the area, and let you better examine the area. If the rot appears to have traveled interiorly into the inner reaches of the trunk, there will be little that can be done. It will not help to paint the wound with pruning paint or other dressings. Regarding the branch higher up in the tree, it could be a result of the basal wound. Also, check the trunk for wounding in the area that leads up to the branch. If the branch is dead, it can be removed during the dormant season. Apple trees in many parts of the county have productive lifespans of 25 to 40 years. Cleaning the wound, and giving your apple tree good care such as thorough soakings during dry periods can prolong the life. You might also wish to remove the rocks from around the base, as they can sometimes harbor problems. Please let me know if you have followup questions. Thanks.