I am not a lawyer but . . . (notice the acronym is IANAL, which I have been accused of lots of times, not necessarily a BAD thing) You are right - things need to change. If you are a PTO you need to have bylaws that state the name of the organization as ________ PTO or Parent Teacher Organization, or any other group of alphabet soup but NOT PTA. I'd be happy to send you a copy of our bylaws if you wish - they are fairly simple, which was intentional, in order to allow wiggle room. You need to have a bank account with the same name as the organization and you need to have your own tax identity with the IRS whether you choose it simply to be tax-exempt or taking it further to the not-for-profit status.
Our group does not have officer's liability insurance. We were split on that. We trust each other, but then I am sure that every group who has had a problem withm issing money would have said that before it happened, as well.
As far as resigning - if you have elections coming up soon, are you willing to hold on until then and just not accept a nomination? I think that would be the best way to handle it, however, without bylaws - how are you holding elections?
Let me know if you would like a copy of our bylaws, and good luck.