I guess I would try giving him things to chew on. We have a gelding who is lippy. Never was a biter, but likes to lip you when you work around him. His mother was the same. Just wanted to mouth things when standing around to be saddled or harnessed, used for a demo. Give her a chain lead and she would just put it in her mouth to move around. Stood like a rock for HOURS if I needed that with Driving her or doing various demonstrations with her, but she NEEDED something to do with her mouth to keep from fidgeting with other body parts like legs.
I think since both these two were mouthed with a bit as young horses before getting trained, they decided they liked mouth things like kids do when chewing gum. None of our other horses going thru this training have ever kept up the chewing after. Those two did NOT chew bit excessively when working, performing, during rides, just when standing, waiting around for the next thing we needed to perform. Both were and are, soft to the hand, give and take as asked for collection or going long.
Perhaps for this horse, you could just pop a kindly, flexible bit and headstall on him for times he needs to stand and behave well, keeping his lips to himself. We mouth the young horses by letting them wear a bit during meals, while in their stalls, tied up for learning patience, so horse can learn to manage this bit and get comfortable wearing bit for long times. They can eat wearing it, drink, and eventually, they learn to QUIT chewing it while wearing it. Getting the bit on is no-big-deal anymore, not worth being excited about it. Their jaws get tired!
Your horse might like this addition to his headgear, playing with it instead of doing “stupid gelding tricks” if bored with you working on him. Adding some dried fruit to the mouthpiece helps make horse MUCH easier to bridle, he opens mouth like a baby bird for such a treat after a few reward like that! Fruit lasts about 15 minutes here, may give him red or colored saliva, but they do like the flavor. Fruit Roll-ups, Fruit by the Foot, both are thin, wrap well on the mouthpiece, then squeezed tight to last a bit longer before bridling him.
Some horses it is just easier to work with them, because them acting out in OTHER WAYS is not a good idea. Getting after them then will cause problems. The mother horse had a loose-jaw bit, so she could lift and drop the mouthpiece while standing still. She was happy, stood like a statue when asked. Just was a little sound, clink, clink every couple seconds. So much nicer than dancing in place, pawing, throwing her head as second choices for the need to move. Her son wears her old bit, acts equally as well playing with his bit when standing quietly.
You want to be running the partnership, so GIVE him something to play with, enjoy the benefits of his attention focus there instead of the poor behavior. Second son of above mare has never wanted to mouth anything. He stands quietly and needs no “gum” type toy to keep his mouth busy. They are what they are. Some bit clinking is easy to live with if horse will behave standing with that bit.
We use ring sided bits for the mouthing/bitting of our young horses, most often a French Link mouth because it moves easily over the tongue. Horse can manipulate that mouthpiece for his needs of drinking, chewing food, get his tongue over and back under while wearing it. Bit is not real tight up in the mouth, horse can lift and drop the mouthpiece as he pleases while wearing it.
None of the punishment ideas work very well once horse looks at the lippy, nippy thing as a game. Distract him with a chew-toy and BOTH of you are a lot happier. Have you tried the Jolly Ball for an outside toy? Some horses love playing with it.