Sorry to hear about your horse's problem. This sounds like a traumatic injury such as a penile hematoma. This usually results from being kicked in the sheath area or the gelding traumatizing the penis when erect. The other possibility would be a squamous cell carcinoma or sarcoid on the penis. In any event, the penis cannot remain outside the sheath and swollen for more than about 24-48 hours before it will start to undergo necrosis from the blood pooling effects and dependant edema. This is something that should be seen by a vet. Without the resources to afford a vet, you can attempt to manage it by creating a sling for the penis to hold it up to the belly and not close off the urethra where he needs to pee from. He needs to be on anti-inflammatories such as phenylbutazone as well. You'll need to monitor his ability to pass urine very closely and if he cannot pass urine, you must contact a vet. If the penis begins to ooze serum or pus from the swelling, you must contact a vet as the penis may need to be partially removed to get it back in the sheath. Hope this helps. Best of luck.
This has been going on for some time. I have doubts about the ability of the penis to survive , although without seeing the horse personally, I cannot say for certain one way or the other. Continue to administer the bute (but don't combine it with banamine as this is hard on the kidney's). No more than 3 grams (max) per day. Do Not lance the swelling as this will certainly result in more edema and possibly infection which will be very bad. It could also impair the ability to urinate. If you are in TX, then A&M had recently published a technique to remove the dead part of the penis with the horse standing for around $200. This might be your best bet if possible. If you try to remove the dead penis yourself, you will have hemorrhage problems and it may kill the horse. I wouldn't recommend putting him down just yet but it may come to that if he cannot urinate. Contacting a vet is really necessary at this point in order to have a chance at successful outcome.
You could contact the clinic at Pullman and see if they would be willing to look into the procedure for you guys. It was just presentated in December at the AAEP in San Diego. There might be some information about it at www.aaep.org Glad my answer was acceptable. Best of luck!