First of all, he would get used to the E collar if you left it on him. But, since you are that bothered by it, call your vet and ask for the cream they use to deter licking. I believe it is bitter apple, but not sure. I just know it works!
Also, if his penis stays out and does not go back in, take him to the vet! If it is only out for short times, no big deal.
You definitely don't want him to lick the surgical area...he can remove the sutures and also get an infection.
Good luck!