We just received a 6 month old Schnauzer from a puppy mill. The dog doesn't mind wearing a collar and leash, but when I get ready to lead him somewhere, he refuses to move. I have dragged him 100ft. At a time and he never gave in. I have to carry him anywhere I want him to go. He seems to have two favorite places where he is comfortable, my living room and his crate. He is very timid but will slink over to you. He has no self confidence. I have not found any treat he really likes and he will not play with toys. I am trying to take him for walks, but he will not move. I tie him in the yard and he moves. A trainer suggested getting him around another more confident dog in the hopes he would learn by example. Does anyone have any suggestions? Thank you in advance.

Hi.
It is very natural for a puppymill dog to be comfortable in a crate as this is where they spend their entire time growing up.
The self confidence would also be because of this as it is unlikely he has had much human company.
Did you adopt the puppy? Or rescue it? Or did you knowlingly buy from a puppy mill?

Dragging him 100ft as you said is a very bad idea and will only make him hate his lead more.

When lead training a difficuly dog it is recommended to put a collar on them until they get used to the sensation of something around their neck.

The next step is to attach a small weight to the front of the collar to give the sensation of slight pulling.
(The weight should only be used in 10-20 minute intervals.

Next step is to attach a lead to the collar and to let the pup drag it behind them around the house.

Finally, you should be able to hold onto the lead.
Let the puppy guide you as to where he wants to the first few times, and gradually lead him around, pulling on the lead gently and calling him to you.

Treats work great in this situation as it encourages him to walk with/to you whilst the lead is on.

As for stopping him being timid.
It may never happen, it could just be the temperament of the dog.
I have 2 miniature poodles and my older girl was extremely timid and frightened of strangers.
I got my younger boy who is very outgoing and loves everyone, his behaviour helped my female to come out of her shell a little and she is a lot less wary of strangers. She is not 'cured' and I doubt she ever will be but it is at least manageble now.

Puppy training classes are another way to help your dog overcome his fears. It could take a few weeks to see an improvement or it could take 6 months, it is really up to your dog.

Also bear in mind that you have only just got him and he has had 6 months of abuse from the puppymill owner.
It will take him a while to realise that life can be better than being locked up in a cage.

We adopted him from a rescue organization. We did know he was a puppy mill puppy. I now realize dragging him was not a good idea and won't try it again. He doesn't mind the collar so I will let him drag the leash around the house. I doesn't fight the collar or leash as long as I follow him where he wants to go. I will see if I can find some training classes that he can participate in if he won't let you lead him. Until then he will get carried when we need to move. Thanks for your input.

Correction: I doesn't fight the collar or leash as long as I follow him where he wants to go. -> HE doesn't fight the collar or leash as long as I follow him where he wants to go.

Puppy training classes are great,I've had a lot of success with them.
I'm not sure about in the states but here they are only between 2-8 dollars per session. I would recommend lead training before you go if you can...
Once he gets used to dragging the lead behind him try coaxing him along with some treats like liver snacks or small pieces of boiled chicken (no cooked bones)
It is best to do this in the afternoon just before dinner time as he will be hungry and be more likely to go after the food.
Just pull on the lead very softly while holding the food in front of his nose... as he walks forward move the food away so he follows it.
After he has walked a few steps reward him with the food.

It is a slow process sometimes but once he is walking on the lead he won't forget, it's just like riding a bike ;)

I am actually not answering to the question but I can definitely relate to the same problem. I have a 12 week old Australian Shepperd/Terrier mix that I rescued from the previous owner who kept him locked along with 7 of his other litter and the two adult parents in the back of his house. Sad to say the backyard wasn't even a place for so many dogs to run around and play. He was really shy on the first day when I brought him home but now his up and playing with my other dog. He even responds when I call him to go outside. The only problem now is that he won't walk or budge when I attach the leash on him. I've tried to give him treats but he wouldn't even move an each. He actually tries to run away from me. I really hope that a miracle happens if I continue to work with other options to get him to walk on the leas.