Very similar story for my 1.5 year old. Visits to the ER for steroid nebulizers two nights in a row. We were never kept for observation, but that may be because he's older. I don't think croup is supposed to last long. We had two bad nights and got better steadily for another week until it was over.
But yeah croup is nasty. We thought he had inhaled something and was choking the first night.