If it is deeper than 1/4 for an adult, stitches are generally required to close it.
I don't know if this goes the same for an infant/toddler/child.
I don't use antibiotic ointment - it has a tendency to keep in whatever bacteria are left behind after washing, defeating the purpose sometimes. Also, I believe it needs to be washed off and changed.
I would ask your pediatrician before using a liquid bandage. The stuff really smells volatile, and it has a requirement of not using it in conjunction with ointments or other things.
Personally if you are worried about scarring, I would contact your pediatrician ASAP. Not being able to see the cut, I can't tell if it does need a stitch or two.