It could be "skin tags". Meaning that the skin gets raw scraped up, then heals by folding back over its self. Hottie has one on his back leg, and had one between the pads in his paw.That one is as big as the tip of a ball point pen. The one on the paw was removed surgically as it was a little larger, and felt like an ingrown toenail to him. They can get puss inhind it. The behavior you were mentioning about excessive licking could have done this.
It looks like this - lets say you scrap your arm, and the skin rolls up. We take showers, and also take that off. The dog the skin stays rolled there ( they look like bumps- ) and only the attachint tip is actually able to feel pain. With the one on Hotties leg, we put vaseline or neosporon on it. It does two things- it moisturizes the attachment at the bump, and doesnt feel like someone is lifting. When the "skin tag" happens, most of it comes off, but not the very tip, and this makes the bump.
Treatment from my vet is keep is lubricated, and not only does this make it not hurt, but also with like vaseline, the skin will soften under and around it, and it will fall off. The other option is surgical with a local. ... ( just saying but that is how we solved the one on his paw- it was bothering him more. )