http://www.pets.ca/forum/showthread.php?t=26651
please take a look at my post about the problems my dog is having
sounds very similar, she actually chews her pads off and i have provided images...
she has to wear that damn cone everytime i leave the house and it sucks, its been an ongoing thing with my vet for like 9 months and like you, i have spent about 2 thousand dollars on random solutions...
hopefully we can figure these problems out!