I would check H Pylori, too, just in case. Our son was 12 months old when we brought him home, and we were convinced he had giardia or H pylori - 2-5 diaper explosions a day! But after testing 4 or 5 times, all were negative. We cut out dairy and it lessened, cut out wheat too and all was normal.
After 2 years of no wheat or dairy (for the most part), we recently had him officially tested for allergies. Came back with NO allergy to wheat or milk!!!
We've been re-introducing wheat slowly and it's going great. Our ped thinks his digestive system was just underdeveloped and unused to lots of variety when he was younger. Dairy still gives him a problem so he may be lactose intolerant.
Your little one may have an intolerance he will outgrow or not. You can find many, many dairy-free alternatives now. There are soy yogurts that you can get at most supermarkets (our guy didn't do great with soy, either though, so we stick with rice products). Rice Dream makes rice cheese slices in Swiss, American and Mozzarella flavors. Used to get at any supermarket - now I only find them at Hannaford or Whole Foods. Whole Foods has a bigger selection, including cheese in larger blocks. Also try almond cheese - it's good. There are also good ice cream alternatives - Rice Dream has some, and Tofutti. Also, google casein-free or dairy-free recipes and you'll get lots of ideas. Replacing regular milk with Rice milk in recipes doesn't always work well, but you'll learn by trial and error.
By the way, if you have a Trader Joe's near you, they have the lowest prices for rice milk - either their brand or Rice Dream. I buy by the case!