We foster a lot of shy cats and try to get them socialized. The hiding and skittishness is normal. As long as the cat is eating eating I would let her be and let her get used to things. Then while she's eating you can start to work with her getting closer and touching. It may go on for weeks but she'll come around.

Speaking as a former animal rescue volunteer, I have to tell you that as soon as you start feeding this cat, you've signed an unspoken contract with it. It sounds as though, from his behavior and reactions to you, he is definitely a stray. You have two choices. If you stop feeding him, he will eventually find someplace else to go for food. If you continue to feed, you'll need to trap him (call your local police/animal control for loan of a trap), find a vet who can handle a feral (local rescues can be of help to you there. They may also be able to send one of their volunteers out to help you) and follow their direction. You can vet, neuter/spay this cat and return him to the outside. Do not let him in amongst your cats. He could prove to be aggressive and also be carrying one of those nasty kitty viruses.