In my case, it was like my lips got really chapped and dried out - started to peel off - and then kept on peeling. It did cross the border of my lips and made a crusty patch or two. Looked like my lipstick was smudged, only I wasn't wearing any. I'm not a habitual lip biter or picker. My lips were so much inflamed as they were disappearing. The skin was very thin and the patches that peeled had a smoother texture and darker color.
It went on for months. Thing is, it started while I was trying to kick a nasty finger infection. Between the 4th antibiotic combo and the first antifungal, my lips started to peel off. It wasn't a known side effect of any of the meds, and it continued long after I quit taking them. So the one thing we do know is that my system was under a lot of stress and I was perhaps immunocompromised. The timing and the response to the lysine suggest a viral cause in my case, at least that's my dentist's take on it. I posted a detailed question about this on netwellness.org, but I haven't gotten a response yet.
I found some research related to cellular lysine/arginine ratios and herpes virus replication. High lysine stops replication. This may or may not be what's happening in my case. It could be a different strain of herpes virus or another virus that's sensitive to lysine levels. Herpes is typically diagnosed by exam of "the typical lesion". Seems that a non-typical presentation could be completely missed.
It could also be a random autoimmune thing triggered by stress.
A little from the L-lysine page on PDRhealth.com:
ACTIONS AND PHARMACOLOGY
Supplemental L-lysine has putative anti-herpes simplex virus activity. There is preliminary research suggesting that it may have some anti-osteoporotic activity.
MECHANISM OF ACTION
Proteins of the herpes simplex virus are rich in L-arginine, and tissue culture studies indicate an enhancing effect on viral replication when the amino acid ratio of L-arginine to L-lysine is high in the tissue culture media. When the ratio of L-lysine to L-arginine is high, viral replication and the cytopathogenicity of herpes simplex virus have been found to be inhibited.