I'm sorry to hear that your dog is unwell.
There's a couple of different things that come to mind.
The first thing that comes to mind is an allergy. A food allergy, or an allergy to something in the environment, like pollen or a laundry detergent, can cause the dog to lick and bite at his feet - it's a common response to allergies. If he started licking at his feet, moisture could become trapped between his toes, making it ideal for an infection, so the blisters may actually be pockets of infection. Actual blisters could also form, because normally, the dog's fur between the toes allows them to slide against each other smoothly when the dog walks. A moist, tacky toe won't slide well, and you'll end up with friction, and this causes blisters.
And it's likely a circular problem. Because once the blisters or infection are present, this is going to trigger the dog to lick even more, contaminating his feet with more bacteria and preventing healing.
Another possibility is some sort of hormonal imbalance that's making him prone to the blisters. A thyroid problem, for instance, result in susceptibility to bacterial infections. So your dog may be getting little pockets of infections on his feet, in between his toes.
And another thought that comes to mind is an interdigital cyst. These are most commonly related to allergies or problems with the thyroid. You can also see cases where a piece of debris becomes embedded in the skin, so you can look closely at the area and see if there's anything obvious. Unfortunately, with the interdigital cysts, you will need to see a vet for treatment, as they're usually either a symptom of a larger problem, like an allergy, or they're deeply infected, which requires medication.
Here's a photo of an interdigital cyst:
Sometimes, you can end up with an area of swelling, fluid and infection that form around the site where a piece of debris, like a splinter or thorn, becomes embedded in the skin. This could be one possibility - maybe he's been stepping in something outside in your yard or whatnot, and it's been causing him problems? And you may not necessarily see pus - sometimes, you end up with more of a blood tinged fluid.
If your dog is, in fact, suffering from an allergic reaction, Benadryl will help reduce the swelling and any itching that your dog is experiencing. If the Benadryl does help, then you'll know that you're dealing with an allergy. (Although some allergies are so severe that the Benadryl does very little - sometimes, you need high doses of anti-histimine, often via injection. In terms of efficacy, Benadryl isn't all that potent in dogs) It may make him a bit sleepy and I would check with your vet first, especially if he's on other meds. But if your vet OK's it, it may be very helpful until you get him in for an exam.
The dosage is 1mg per 1 pound of body weight up to 50 mgs. This can be given every eight hours. This should help and reduce the symptoms that your dog is experiencing. I would take him to the vet today. It's possible that this is a situation where the allergen is still present and he could be getting worse.
So, with all of this in mind, I think a vet visit is your best bet. They'll be able to give him medication to help heal his feet, and they can address any other related issues, like allergies or thyroid problems. In the meantime, I do have some tips for preventing the situation from worsening.
Now, we'll need to tend to one foot at a time. Usually, you don't want to bandage a dog's wound, but for feet, this is the exception. And we can't have more than one bandage on his feet at a time. You'll also need a lampshade or "e-collar" to prevent licking at his feet. We also need the bandage to remain in place, so he can't mess with it with the lampshade.
First, if he has lots of fur around these lesions, I would trim the fur back a bit so that you can see what you're doing and so the area receives good airflow.
Twice daily, I would soak his feet in a warm tub for 15 minutes, twice a day. You can add some epsom salts too. After the soak, you can wash the foot with antibacterial soap, like Dial. Scrub with the soap for 90 seconds and rinse very, very well - for about two minutes. We want to flush away all traces of soap and bacteria.
I would then use betadine (found in the first aid section of the drug store) to disinfect the area. Dab on a generous amount with a cotton ball. Let this air dry and wipe up any drips. Then, apply some antibiotic ointment. You'll want to do this twice a day. And I would clean both feet, but you can really only wrap one at a time (you can try to do both, but he may not be able to walk well), so once one is healed, continue with the second foot until it's healed too.
Since there's breakage in the skin.I would keep his foot with a light gauze bandage, covered with a self-sticking ace bandage or sock to prevent further contamination of the area. This is especially important when you go outside. Wrap the bandage in a figure 8 pattern and cover the entire foot and wrap a bit up the ankle to hold it in place. Just a couple of layers of gauze will do the trick - we don't want a giant bulky bandage sticking off his foot!
So, give those techniques a try. I also wrote a couple of articles on foot care that you may find helpful:
I hope your dog is feeling better soon! Let me know how he does and don't hesitate to let me know if you have any additional questions!