**Core Concept**
The underlying condition is a localized, self-limiting inflammatory reaction involving the subcutaneous tissue, likely caused by an allergic reaction or trauma.

**Why the Correct Answer is Right**
The presence of discrete, indurated masses in the right cheek, which is erythematous but not warm to touch, is suggestive of a localized reaction. This presentation is classic for a **cyst or abscess formation** due to an allergic reaction or trauma. The absence of systemic symptoms, such as fever, and the localized nature of the reaction further support this diagnosis.

**Why Each Wrong Option is Incorrect**
**Option A:** This option is incorrect because it describes a more severe condition, such as cellulitis, which typically presents with warmth, redness, and swelling, often accompanied by systemic symptoms like fever.

**Option B:** This option is incorrect because it describes a condition that is not consistent with the patient's presentation. Erysipelas is a type of cellulitis that affects the upper dermis and presents with a more severe inflammatory reaction, often accompanied by fever.

**Option C:** This option is incorrect because it describes a condition that is not consistent with the patient's presentation. A cold abscess typically presents with a firm, painless mass and is often associated with a chronic infection, such as tuberculosis.

**Option D:** This option is incorrect because it describes a condition that is not consistent with the patient's presentation. A ganglion cyst is a benign, fluid-filled cyst that typically presents as a painless, firm mass, often on the wrist or hand.

**Clinical Pearl / High-Yield Fact**
When encountering a localized, self-limiting inflammatory reaction in a child, consider the possibility of a benign condition, such as a cyst or abscess formation, and avoid over-aggressive treatment.

**Correct Answer:** C.