Question
What needs to be done for my lace bark elm that has large amount of sap dripping from where I cut a small limb that was too low.  I painted the wound with wound spray and made the cut smooth, but the sap is running down the trunk of the tree.

Answer
This is normal. Trees produce a large amount of sap during the spring and if there is a wound the sap will leak out. As the weather warms up and the sap begins to flow, the trees will appear to bleed from the pruning cuts. While not a concern as far as the overall health of the tree, it can be unsightly and the good news is will stop when the wound heals. When a tree is bleeding about all you can do is keep it well watered so the moisture loss is minimized. Commercially available pruning paints will not  slow the flow of sap from a bleeding wound and will slow down the healing process.  
Sorry, You may have to put up with the leaking until the wound heals. If the weather turns dry I would water the tree since it is losing water through the wound.