Is this a new thing, or has your son always been a troubled sleeper?
This does sound similar to night terrors, something that a lot of children get, and doesn't always have a specific cause.
The first thing to do is rule out anything that might be troubling him. Does he remember the event? Do his nightmares follow a theme, about anything in particular? If your wife and yourself are only recently separated, he might still have some adjusting to do, and perhaps hasn't quite settled into the new routine yet.
My son is a sleepwalker, and did go through a period where his walking was also accpmpanied with nightmares and a kind of hallucinatory state. Like your son, his eyes were open, he would be crying, chattering incoherently, and ohh yes, we were very freaked out by it, I think his apparent fear was contagious.
We found comforting him was enough to settle him down again, without needing to wake him. Waking sleepwalker is something not often recommended, as it can cause further disorientation and distress to the sufferer.
I read recently that night terrors often follow a pattern, i.e, they occur at similiar times during a persons sleep routine. One idea was to keep a diary of the times of night that a child becomes distressed, and then gently wake them each night a little while before the time the disturbance occurs. This is supposed to help break the pattern.
My son is 10 and still occasionally sleepwalks, usually at times of stress, but we havent had nightmares for some time, so I think its safe to say children do grow out of this eventually.
I guess that the nightmares started about 9 months or so ago (my ex-wife and I have been separated for almost 2 years and he seems to have coped with that well).
They don't happen too often but we will start to keep a diary and take it from there.
