The wondeful smell of mold & mildew from records stored in a damp place is noxious for sure. Curatorial means are available to eradicate it, but it's a bit of a pain. The chemical thymol is used to eliminate fungus from paper of all sorts. Go to an art curators supply house like Talasonline.com and you can buy it there. The basic principal involves getting a large cardboard box, putting some sort of shelf inside that you'll put your record jackets on, and then putting an open container of thymol dissolved in alcohol underneath the record jackets. I've speeded things up by evaporating the thymol over a small hot plate or alcohol lamp when I used a wooden "fuming cabinet." After being sealed up for about 24 hours, the thymol has killed the fungus. You'll want to do this in your garage or outside, thymol has a pungent, clove like smell that's not too great either. The odor dimishes as time passes though, unlike the funky smell of mold and mildew.
Musty Smelling Records
I've been getting into analog more, and have noticed some of the used records I've bought have a musty smell. Is there a safe way to remove this? I think it's mostly in the jacket, maybe not the records themselves. If stored next to records that don't smell, will they all become contaminated? Is this supposed to be considered in the ratings (i.e. is it proper to grade an otherwise excellent but musty smelling record near mint)? Or is this just part of the "charm"?