Bless his heart. It does sound like night terrors as opposed to just bad dreams. Have you ever heard of Hylands (www.hylands.com)? It's an all natural brand that you can find at Walgreens, Target, WalMart, etc. They make teething tabs for babies, etc. They make something called Calms Forte for Kids. Here's a little info on it directly from their website (it references night terrors):
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This medicine is designed to safely and effectively counteract mental and physical restlessness in children. Studies show that 69% of our children under 10 years of age are prone to some kind of sleep problem. This doesn’t mean that your child needs to suffer. Calms Forté 4 Kids™ addresses the causes that inhibit a child from sleeping well. Your child won’t wake up groggy like he or she might, when given over-the-counter drugs containing diphenhydramine (such as Benadryl®). This is significant for school-age children who need to be alert first thing in the morning.
Like all of our homeopathic medicines, Calms Forté 4 Kids™ is a formulation of all natural, safe and effective ingredients. A calmative solution to restlessness, this medicine comes in easy-to-administer tablets that dissolve almost instantly in the mouth. Calms Forté 4 Kids™ works without side effects and won't interact with other medications.
125 quick-dissolving tablets, easy to administer
Formulated for children ages 2 and up
No side effects
Can be used with other medications without contraindications or drug interactions
Aspirin- and acetaminophen-free
Addresses other causes that can inhibit children from sleeping well, including night terrors, growing pains, and sleeplessness from vacation travel.
Useful for irritability and wakefulness
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Hope this helps you and your little man out a little bit. =0)