I used sealant, as pictures show.
I, too, was worried about whether this would impair or impinge on new buds, but these elms cannot be stopped, apparently.
As depicted in the second picture (from the top), buds pushed everywhere, regardless of sealant (which in the end just sort of fell away as new growth pushed and pushed).
Oh right.. I've used sealant completely over the wound, not just around the edges. From your pics it looked like really minimal sealant. Maybe I've put too much on mine.