My 3 month old appears to have flakey dry skin on her forhead and head how do we treat it?

Cradle cap. It sound like your little one has cradle cap. You can use anti dandruff shampoo paying attention not to get it in his eyes. You can also apply baby oil to his scalp. It is harmless and usually bothers parents more than the babies. You can also leave it alone.
Home remedies. Your baby may have something called cradle cap or seborrheic dermatitis. This is a very common condition and is easily treated with simple remedies. Use an anti-dandruff shampoo once a day and gently massage with a soft brush or rough washcloth. If your child's scalp is very crusty, put some baby oil or olive oil on the scalp 1 hour before washing to soften the crust.
Seborrhea. Cradle cap is flaky skin lesions like seborrhea on the forehead. It can be softened with oil or moisturizer, removed by using fine comb. Tar shampoo is also effective.
Several ways. Do not over wash. Wash only when needed with a mild soap like dove, but mostly use warm water. Use a good moisturizer like eucerin, aquaphor or cetaphil. If it continues, see your pediatrician as a low dose Hydrocortisone may be needed.
Daily washing. This is likely to be seborrheic dermatitis. They usually outgrow it. For severe cases we can use ketoconazole cream. Mild cases do do not anything apart from daily bathes. For the head putting some cream or baby oil could soften it before bathtime and gentle circular motion while bathing will help remove them. Sometimes using a soft comb can help remove it after it is softened.
Cradle cap. Sounds like cradle cap. The best and safest remedy is to keep your fingers tight and close together while washing or scrubbing the babies scalp with baby shampoo. Do not use baby oil. It will clog pores and make it worse.