It's a little tough to guess from this limited context, but I think when Mike says, "Unless you want it all to go away," he's basically trying to say that the speaker doesn't have to talk about "digging in the basement." The speaker can choose not to talk about something that's bugging him, and they can talk about other things. Or maybe Mike is offering a distraction from the whole thing? (like, getting drunk?)
As far as "Mike's all poo-poo," it just means that Mike is "pooh-poohing" the idea, when means he's dismissing the idea as ridiculous.
Hope this helps!