from a mom who's had to deal w/ croup in 2 kids, i feel your pain! croup is a virus that in a larger person would not be a big deal. but b/c it gets in our kids, their windpipe swells and constricts, thereby producing that awful barky cough. this constriction causes them breathing distress. you can tell b/c the baby's whole stomach/abs will contract to breathe, so it is NOT by sound alone. on the phone the ER nurse had me lay him on his back and watch him breathe and listen. his whole stomach caved in w/ each breath, and there is a wheeze, even heard over the crying. they cry b/c it hurts, they can't breathe, and by crying the body actually is trying to gasp. it is a form of respiratory distress. see if baby is blue around lips or has very cold fingers/toes. we've had to deal w/ croup at home, on vacation, middle of night, you name it. i have small kids, so my son didn't outgrow it till age 5; my dtr is only 2, so she is still "eligible". ugh.
Fortunately, by the time a child sounds "croupy" there are only 3-5 days of virus left to run its course. Our Dr. was VERY specific that he does not recommend giving babies steroids and gave us only enough for 3 days, would only give more if he didn't clear and he was re-examined. The steroids we used were liquid; some kids have to be on a nebulizer in the ER or be given a shot of steroid. The improvement was immediate. such a relief to know your baby can breathe! B/c it is a virus, there is still a cough and yes, it did get "wetter", but coughs change during the course of any illness.
Hang in there mamma, your baby will be fine, and you'll know what to do in the next round. good luck!