If you are interested, there is a fantastic book on dog body language:
Amazon.com: Canine Body Language: A Photographic...
It's VERY long, but extremely helpful. There's also a shorter guide that's excellent on "appeasement" signals.
Amazon.com: On Talking Terms With Dogs: Calming...
This is also a great online reference for training in general:
Dog Star Daily
I can almost guarantee you that if he if he is obeying your commands while backing away and licking his lips, he is uncomfortable. I don't mean this as criticism. Some dogs are simply very shy, and the smaller they are, the more likely shyness is. Just as we may not understand dog body language, they don't understand ours either. You are being friendly, but he may not recognize it as such.
It sounds to me like he is trying to obey you while keeping himself safe by maintaining a certain distance.