Since my skin is itchy/crawly due to allergies and my daughter's too, our pediatrician has my daughter on Zyrtec in the mornings because it has anti-itch qualities with it and Singular at night. I would bet that your daughter's skin itches or crawls like ours (it's hard to describe if you don't know the feeling). I pick scabs and scratch continually sometimes without realizing that is what I'm doing, have done so all my life. My daughter scratches in her sleep. Sometimes when nervous or stressed, the itchiness will hyper itself and benedryl or atarax is the only thing that will calm it. And once the itching starts, it does rather make you "irritable". They tend to go hand in hand and one will exacerbate the other.
OTC Topical creams usually won't help (that is what my dermatologist suggested), a mild topical steroid and sometimes a heavy topical steroid (depending on the type of itch..lesion) will do.
The Zyrtec is for the allergies its possible the spots are from an allergy I would think that would be the way to go, see a dermatologist , instead of thinking in terms of anxiety meds for a 5 year old .Treat the cause of the habit, why has she got the spots , did the doctor not want to treat them?
The correct term for skin/scab picking is called Dermatillomania. It is an impulse control disorder and is a behaviour often triggered by tension, anxiety, or stress. As far as I know, Zyrtec is not one of the medications used for anxiety or impulse control (usually it is one of the SSRI's) but I read on the internet that this medication can have a postive effect on anxiety. Nonetheless, if your daughter is suffering from some form of anxiety and/or impulse behaviour, there are better medications for these issues. I doubt if the dermatillomania and her sensitivity to allergies are related. Hope this helps ....