Fill a pillow or stuffed animal with lavendar for him to sleep with. Tell him it will protect him from bad dreams. Dog stuffed animals are best for kids because they associate dogs with guarding things. Make a dreamcatcher and hang it over his bed, tell him the web catches bad dreams and allows good dreams to pass through the hole in the center. The more connected the dreamcatcher is to him the better, so incorporate things into it that relate to him, such as favorite color, favorite animal, etc. especially weave into it something that is his and has his energy.
My daughter had night terrors from infancy until the age of four. My husband purchased a witches knot pendant for her, and I empowered it with a protection. She hasn't had a night terror nor nightmare since, and it has been over a year. She laughs and talks in her sleep still, nothing bad with that.