I don’t think you are limited in any way with redwood siding. It is among the most stable and attractive siding choices available. Why you would want to cover it in thick vinyl goo, I can’t quite figure, but I’m sure it would work as well as any other siding. Give the expense and attractive appearance of premium redwood siding, what makes you want to pursue liquid siding? Properly prepared, primed and painted, redwood siding should hold a finish very well.