I have the same problem with a couple of my shetlands and I think it's down to photosensitivity ... sometimes related to something they've eaten (apparently Bog Asphodel is a common culprit, although I haven't seen it on my ground).
I've seen mine scratching their heads on trees and gates, so it's obviously itchy and the scratching causes puffiness. I have used vaseline mixed with a small amount (literally a drop or two) of lavender and tea tree essential oils. It seems to give some relief, although don't get it in their eyes.
I did check with my vet and, short of a skin scrape and formal diagnosis, she thought this was probably the cause and a reasonable approach to treating it.
What did your shepherd friend say Mo?