Well... it's been ages since I had to think about bottle feeding a baby, so forgive me if this sounds like a stupid suggestion/comment.....
but when you mention that he isn't finishing a bottle and burning out, what came to mind for me was - is the opening of the nipple too small? Maybe with the cereal added in, it would be thicker... maybe he is having to work too hard to get it out of the bottle. I can remember taking a hot sewing needle to the nipple to increase the size of the whole, or I think they sell ones that have more of and X cut in them instead of a whole so more comes out the of the nipple.
It's probably not the entire solution for you as I'm sure it has nothing to do with the poo problem, but perhaps it will help with his ability to finish eating.