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Insulating Outside Walls

We live in Massachusetts and winters are very cold here. Our house is almost 50 years old. We just had a heat audit done. The Consultant told us that there is no insulation in outside walls surrounding the whole house. He suggested to have 'Celluls' insulation blown in. Below are my questions from his suggesion.

1) Is Celluls a good choice of insulation for ouside wall?
2) Is it worth having the walls insulated? Is is cost effective?
3) Does it make any difference what type of siding is there? We have aluminium sidings.
4) I was reading some threads on insulating the outside walls and some of them talked about mold in the walls caused by moisture afer putting the insulation. Is this something we need to think about? I certainly do not want mold growing in my walls. I rather not have them insulated if there is a chance that mold might grow in in the walls.

Thanks in advance for you help.

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