thats your problem right there.. "dieting" is not going to do it, you need to SERIOUSLY dedicate yourself to eating properly as a lifestyle change AND working out at least 3 times a week.
believe me I know how you feel, I'm right there with you, I've only lost about 30 pounds in the 3 and a half months I started my 6 month weight loss plan, I got bronchitis, went on vacation, and hurt my leg overdoing myself in the gym so I let myself slack and behind on my weight loss goals. But now in the last few months i'm dedicated to losing as much as I can before my surgery. You NEEEEED to do that cardio in the gym... that first month I really tried I ended up losing 17 pounds, I did the gym 3-4 days a week and really ate what people are normally supposed to eat in terms of the food pyramid etc.
about your fear of the gym... think of it this way.. even if you WERE skinny and in shape.. there would always be more people there who are in better shape or better looking or richer lol.. screw what everyone else thinks... I take pride in being a fat guy going to the gym, I know why i'm there and do what I need to do and feel proud of myself when I do it.