I would guess that the waking up every two hours to nurse is probably un-related. Babies go through a growth spurt at about 4 months, and she's probably just hungry at night. It doesn't last too long, and you might want to try to give her more calories during the day if possible. (And nap whenever you possibly can so that you have more sanity to deal with your evenings!)
If you're breast-feeding, how is your supply in the afternoon? I know you said she won't nurse during that time, but if she tried and found it lacking in the past, that could have something to do with it.
You're not failing. (Trust me, all of us think we're failing half the time.) You're a Mom, and you're doing your best. I've heard of babies who just need to cry to get to sleep, but have you checked with your pediatrician? This does seem like alot of crying.