Definitely dried out fluid of some sort.
I would think that you need to do the following things to resurrect your front brake..
- wipe out and clean the reservoir
- make sure the drain hole for the fluid is clear at the bottom of the reservoir
- you may need to take the caliper off the bike for a good component inspection and clean
- if you can take the brake pad out of the piston side of the caliper and check both pads for wear and contamination
- inpect the seal around the piston for leaking - I think this is where you will find most of your problems
the rest is just clean and replace as necessary...
then run some clean brake fluid through the brake lines, and hopefully after bleeding everything will be better than what you have at the moment - which is nada..
good pictures - looks like there is also some junk on the disc rotor which needs to be cleaned off.
apart from that the whole bike looks pretty good..
