Getting ready to paint after fake brick tear off.

We've removed the fake brick from the exterior of our 1920's house, and let is sit for a year. The siding underneath, though in excellent condition overall, has a blackish/grey film all over it, with the parts least in the sun, and easiest to collect water being the darkest. I think it's mildew, and possibly creosote residue from the backing of the fake brick. (3' x 4' sheets on particle board) My father in-law thinks it's just dirt. Pressure washing doesn't remove it all, but scrubbing the surface with bleach and water does, but you have to scrub quite a bit. I want to know if it's necessary to scrub the entire house, or if pressure washing is "good enough".

The next question is... there are only 2 coats of paint there, and where it chips off it's down to the bare wood. I think we need to use an oil based primer and a latex paint over that. He thinks we should use latex primer because it breathes, and that you have to use latex primer with latex paint, and oil paint over oil primer. I would like some advice, especially if any of you have painted after fake brick!!!