there is nothing wrong with what you are doing!! let me tell you my story.
i am very strongly against any situation in which an infant under ~12 months is left to cry. as a result, i NEVER let my son cry if i could help it. by all means, if someone is at the end of their rope, there is nothing wrong with taking a break, walking away from baby, because baby picks up on mom or dads stress and it makes things worse anyway. but for the most part, there is no real reason for babies to have to be laying in their crib crying.
the first 3 months are also known in some circles as the 4th trimester. baby is SO immature mentally, they do not even realize that their body is a separate being than moms! after all, they have spent 9 months only knowing what moms body sounds like, smells like, feels like, etc. so its no surprise that infants under 4 months would be very hard to get to sleep alone.
also, the second thing is that babies are not programmed to sleep well. some do, yes, but really, i am more concerned about a baby whos sleeping for long periods of time than a baby who wakes every hour. the reason is that if a baby is waking often, they are not entering into too deep a sleep that something could interfere with their breathing... and also waking often is a very good deterrent of SIDS.
so, back to my story, when my son was born i was of course told that i would have to do this or that, let him cry to get his lungs strong (which is actually bull because there is reduced oxygen when baby is screaming..) and that he wont ever learn to sleep on his own.
we NEVER let him cry it out under any circumstances... and he is the BEST sleeper i have ever seen. hes almost 3, and though sometimes he lays in bed for quite a while and talks or reads books, he never cries, never fights us at bedtime, he simply lays in bed and relaxes and goes to sleep. very rarely, like when he is sick or overtired, he will be fussy and cranky, but he wont fight that its definatly bedtime. by not letting him cry or expecting him to just fall asleep on his own, i feel we have done him a world of favors. first of all, we never put him to bed on our schedule. he sleeps when hes tired. that way he knows when hes tired, and that its always ok to go to sleep, and that if he has a problem or a worry, he knows we are there in a minute to get him and everything is ok. second, the crib (yes, i said crib) isnt a scary place. he has never been left alone, so his bed isnt a place that hes been left alone crying. third, he has learned to be an independent sleeper by us allowing him to be dependent while he needed to be. children in all stages of their growth, have periods where they NEED their parents to depend on! babies depend on their parents for EVERYTHING. and to allow a baby to depend on you... THAT is what fosters independence. knowing that they have a safe and secure place to go with their needs, that sets the stage for life long trust between you and your child. that means that when they are 2 and having a tantrum, you will be able to read what they need. it means that when they are not able to express what they are feeling, you have the ability and connection to figure it out. they trust you, and so their tantrums are less often and less wild because they know you are in control, even if they arent. i swear, my son has been a fantastic 2 year old. NOTHING like other two year olds i know.
it seems so backwards to allow dependnce in order to give independence. it would seem that you would have to "practice" independence, but that is not the case! your child WILL learn to sleep on his own. i promise! it might be exhausting, it might be frustrating, but it only lasts for a very short time, and you wont regret a SECOND!!
my resource, the ONLY person who was supporting me when i first had my son was dr sears. i dont know him personally, but i read his books and had other info and it was so nice to have someone giving me support to do exactly what my heart was telling me to do. it sounds like you are doing that - you are doing exactly what you need to do to help your son. there is NEVER anything wrong with that! keep it up! the closer you listen and respond now, the better you will be able to later, i swear to you there is nothing like it. NO ONE knows your son like you do. not your parents, not your inlaws, not your doctor, not your friends. only you have the instincts to give your son exactly what he needs and how he needs it. if you stop listening to that, you could lose it and its such a valuable tool to have!
anyway, www.askdrsears.com is the website, there are books galore on there, but you can probably get them used on amazon or something. they are fantastic. really an awesome place to go!
as far as stopping the nursing when he falls asleep, that works sometimes, it takes a couple tries, but it should work. you never deny him nursing more if he needs to, but you dont have to be a constant plug either :P so if it works after a couple tries, as the sucking slows down and stops, you can release him, but gently, and see if it works. put him back on and when he stops again, try again. it wont always work, but its worth a try when you need to put him down. OR
get a moby wrap! they are insanely comfortable! i loved the one i had. it was amazing. and baby loves nothing more than being in your arms watching everything you are doing. :)
so, anyway, let me know if you just need some support. another place to go is the la leche league if you are breastfeeding - they will help you with everything - from REAL moms who have gone through many of the same things. if there isnt a group in your immediate town, try a nearby one. i had to drive an hour to go to the group closest to me, but it was SO WORTH IT!
anyway.
yeah. :)