In renovating a 100 yr old house, we will be replacing about half of the exterior siding. The siding is nailed directly to (real) 2x4's and there was plaster on the interior (now removed, but will be replaced). We will insulate the walls. The siding which is not in need of replacing is fitted tight, with no light or air passing between the boards. Is it ok to place insulation directly next to the siding? In new construction, sheathing is used, but can not be used in this application. If not, is there any product that can seal the siding from the inside? Or, what suggestions do you have. We are new at this and need lots of help. Appreciate any advice you can offer.