Okay, first of all it could be excema so don't rule that out entirely!
It could very easily be from his drooling especially b/c he's likely teething. This also means he probably has "stuff" in his mouth all day long! It's a tough situation b/c the drool can cause the rash, but wiping his face too much during the day will cause dryness and irritation.
We found that the Medela product line was really great. The lotions were thick, but not greasy. We "lubed him up" twice a day and asked the daycare folks to add more if he was "drying out". Recently, my son had very chapped lips and the pediatrican said that the best thing to use is Vaseline. Try putting some AROUND his mouth and in the areas of irritation. It will keep the area from drying out further, but may also work to "re-route" the drools