I honestly don't think you have to worry about that bag disintegrating. It looks like it is in good shape. I wouldn't be afraid of dunking it. The bags that disintegrate are in really bad shape.I need some advice! I got incredibly lucky on this one, but I'm not quite sure how to proceed. The bag is misshapen, but I'm not sure I should dunk it-I've read that some of the bags from this era disintegrate. It also has a tear in the piping on the strap. Should I leave it alone? Should I try to repair it? Otherwise, it's in great shape. Maybe just conditioner? I'd appreciate any thoughts.
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If you don't want to dunk, you can heat towels in the dryer and lightly stuff to reshape, then hang in in your bathroom for a few weeks. The moisture from your shower will help it reshape.
For the cut on the strap, I attempted to repair a similar cut by applying layers of leather cement. I then used a mixture of paint and Lexol to try to blend it in. It wasn't perfect (and was a pain to try to do), but it helped.