Dear K.,
There are some good articles on www.kellymom.com regarding nighttime issues. For instance, http://www.kellymom.com/parenting/sleep/sleep.html
I wonder if your baby would benefit from sleeping next to you, rather than in a crib. We have co-slept with our three so far, and it provides much-needed security for baby through the night. Co-sleeping is still in the minority in our culture, but if you step back and look at other cultures and what has been done over history, the real 'experiment' is in putting babies away from their parents for the night. For our family, we get more sleep and peace by being together. Especially with nursing babies, this is a great way to do it. I feel my baby starting to wiggle, and latch him on before he cries. I'm awake for 1 minute, then we're both off to sleep. It may take your son a couple of weeks to realize you're really there every time, but I would think his terror would subside after a bit. The longterm benefits to meeting their needs while they're young will be worth the sacrifice.
I hope you find the help you need.
Blessings,
R.
Supporting you as you nurture your family.
www.NurturedFamily.com