Thanks to everyone for your inputs! Funny that one of you mentioned the tree-man since we call him the tree-dog at home... he he. I look forward to going to the vet so he can take another look at it and reconsider the "let's shave it down" approach since it seems to grow back even stronger. The main problem is that Milo is not putting that leg down to walk and limps all the time, I hate to see him like this and I need to find a solution.
I will keep you posted.
Thanks once again for all your help and comments.