Mold on Vinegar Batch?
Great question.

First off, the mold. This is nothing to worry about, you should be skimming it off but as far as Vinegar creation it's normal and to be expected.

These "worms" have a name :-) Turbatrix Aceti (a.k.a Vinegar Worm) you can read more about them here -> wiki/Turbatrix_aceti

Why is that mold there? Well if you think about the fermentation process. It's just thousands of bacteria 'eating' your 'mother' now they have to produce something as a byproduct which is the mold you see on the top. Get rid of it and leave it to carry on.


  If you see a scum forming on top, don’t disturb it; this is the
  mother. Eventually the mother will sink toward the bottom and continue
  its work. However if you see mold forming on top, by all means skim
  that off. Mother isn’t moldy; it’s scummy.


Source: http://www.rural-revolution.com/2013/07/making-fruit-scrap-vinegar.html &lt;- Well worth a read since you're making vinegar :-)

Mold = Bad (Clean it off)
Froth = Good (Leave it alone til' it turns to mold.

Question: Is the vinegar batch completely spoiled?
Answer: No.