Daktarin CREAM is the correct treatment for your nipples. The gel is for your baby's mouth. The gel carrier will not penetrate the skin properly. The gel needs to be given to your baby, but carefully in little smears, one smear per mouth section.
Canestan should very, very quickly clear up your baby's nappy rash (probably you will see an improvement within a few hours, and much better by tomorrow) - IF it's thrush. It's quite a good indicator of a systemic thrush infection, is that.
A couple of other things to try are grapefruit seed extract (NOT grape seed) which comes in a liquid, which is diluted and tastes foul, or tablets. I keep a stock of both, using a few drops of the liquid in the rinse cycle of the machine if we get an infection (I'm very, very prone to vaginal thrush while pregnant which I am now) and take the tablets. Acidophillus is also excellent. It's available in tablets and it's a probiotic which can help to re-populate the gut flora which overcomes the candida infection.
If you have even the slightest symptoms of vaginal thrush then I'd suggest getting yourself a Canesten combi, too (free on prescription) - and if you DTD before bub arrived (I'm assuming you've not within 11 days of a section
) then it's worth getting your OH to treat himself with cream for a few days. It's all going to help break the cycle.
Consider drying your nips and bits with facecloths (one each!) after a shower, then 60 degree washing it (facecloth means less machine washing than a full towel) - and anything that touches your nips, your bits and your baby's bottom needs to be washed at 60 degrees at least after each use. So, new bras daily, use disposable breast pads or wash them very regularly on a hot wash, and if the bras will take it iron them on the inside to kill the spores. Ditto washable breast pads.
It will get cleared and you will feel much better very quickly if it is ductal thrush. It really is worth hanging on in there.