"Indian paint pot" means: A concave, iron oxide–containing mineral concretion such as red shale which sheds a chalky, reddish debris when wet and rubbed, often found.... This is a fairly neutral word with no inherent risk attached. There is no real cause for parental concern; it is descriptive vocabulary rather than something dangerous. If your child uses it, context will usually make the meaning clear. A brief, curious question about where they heard it is generally enough to know whether to follow up.