Dealing with a dry nose that bleeds is a fairly simple exercise. All you have to do is make sure you are taking regular care of this problem. The very first step is to get your son to stop this compulsive habit. While it is not an easy task, you must keep trying. Keep a close watch on him as and when you can and try hard to divert his attention from it. The moment he starts picking his nose, you should try something like playing a quick game of catch with him. Basically, keep his hands occupied so that they are off his nose. This of course will take a lot of time to become into a permanent habit. But if you keep at it, you will succeed. You need to understand why your son is constantly picking his nose. Most of the time, this problem has to do directly with dry skin. If the skin is dry, it tends to itch, and when you try to scratch the itch, you end up rupturing the skin which has become papery due to dryness. Petroleum jelly is the safest product to use inside the nose. It is relatively harmless, very greasy and will not cause any damage to the airways either. You can apply a small amount on his finger and make him apply the cream himself. Most of the time, children seem to enjoy this activity!
If you are concerned that your child will somehow inhale or swallow the petroleum jelly, then you can use something like clarified butter instead. This is an excellent healing product and will not cause any damage if swallowed since it is an edible product in the first place. You can also simply keep some lilted butter in a small dish for this purpose alone. Naturally, you need to ensure that your son is not allergic to this product, which may sometimes be the case. If he should be allergic, then you can also use any edible oil as an alternative. Most of the time, olive oil is the best product to use for this purpose. You should also ensure that you definitely apply this at night before bedtime. Another rule you must start enforcing with your son is to clear out and blow his nose each morning. This will ensure that he is rid of all sorts of clumps or residues left in his nose over the night.