If it's a general blotchy redness around his lips, it very well could be an allergy to milk (either the casein or the whey protein). Milk allergies don't just have to affect the digestive system; they can also cause skin problems. If it happens every time he eats--and he usually always has milk with the food he eats--then he should be checked for milk allergy. Since he's still a baby/toddler, his pediatrician "might" test him for it. If she refuses, then find a naturopathic or an Integration doctor, who has the test. It costs about $25-$30 and is a saliva test.
Do the corners of his mouth crack? That can signify that he either isn't getting enough of the B-Vitamins or is low on iron. My 9-year-old daughter gets the cracks at the sides of her mouth quite a bit, and it's worse in the winter. She takes a B-Complex vitamin all year round, so when it starts up in the winter, I know she's low on iron and I give her an iron pill.
Remember that food intolerances are different from an allergy. Food allergies usually show up instantly--hives, swelling, can't breathe/swallow. (well, not usually with the milk allergies--I didn't find out I had a casein allergy until I was 40 years old) But food intolerances often have a delayed reaction that can show up a day, two days, four days, even a week later. Which makes it very hard to find out which food your son might be intolerant to.
I know. Been there, done that. My Integration Doctor did what's called an ELISA ALCAT test, which tested me for 100 foods. It's not perfect, but it looks at the most common 100 foods most people eat. That test costs about $199.
I know it's out of your own pocket (but you might be reimbursement through your medical flex plan), but conventional doctors don't test for food problems unless you're in the Emergency Room suffering from a really bad allergic reaction. It's just not something they do.
However, naturopathic and Integration doctors DO test for food and nutrition problems. If I hadn't gotten so horribly sick in Feb 2008 and my doctor of 10-years kicked me out of the clinic (he couldn't find out what was wrong with me and told me to go find someone else who could help me) I would have never found out the TRUE CAUSE of my problems/
sicknesses. We now know the root cause(s) and are working on fixing a lot of nutrient deficiencies and food intolerances.
I SO WISH my parents had discovered my casein allergy when I was little; a lot of the food intolerances I suffer from today might never have occurred. You have the ability and the chance to discover what, if anything, your son is allergic or intolerant to. Good luck as you look into it.