Aww, I am so sorry. I know how upsetting it is to see that .
Could it be obsessive compulsive disorder? That can occur in cats. I knew of cats chewing their tail until its raw . One little one, in particular, was so intense that he ripped all his tail fur off and caused major irritation . The problem with keeping a bandage on is that an infection can occur underneath. The bandage is a temporary solution, and it should really only be left on for a very short time (no longer than a week). Have you taken the baby to a vet? First, I would rule out any skin conditions and/or physical health problems. If nothing is found, you may want to look into a cat behaviorist.
Let us know how it goes..