couldnt agree more with ginger my papillon who is 2.5yrs was constantly trying to get at his butt he was also scooting or abruply sitting went to the vet his anal glands shall we say were full he was like a new dog they sqeezed them good luck
Is this lump on both sides of his penile shaft? And the same size on both sides? And -more importantly -does it disappear sometimes, then come back again at other times?
If so, I believe that is a natural thing. It is called the "Bulbus Glandis". It occurs whenever a male dog gets excited.
Check the lump to see if it does definitely go away at certain times. If it does -that's OK and nothing to worry about -in itself.
If it doesn't, then get the lump checked out at the vet's.
But...if he's not happy, and keeps biting/licking at his penis or rear end, then he obviously has some problem, some pain or irritation. My first guess is that he could have anal gland problems (in which case e needs to see the vet) Does he "scoot"? That's a very obvious sign of anal gland irritation.
My second guess is that he is feeling the effects of testosterone, -kind of like a doggy puberty, and in the absence of an opportunity to mate it is making him miserable.
The answer to that is to get him neutered unless you have firm plans to use him at stud in the future. Believe me, I am all for things being "natural" but am aware of the problems an entire dog can undergo. Neutering would actually be doing him a favour.