We went through the same thing with our son when he was about 2 1/2 - 3 years old. The spray bottle worked for us, very similar to your experience. I let him spray the room whenever he saw a monster and we did it every night before bed. We used special 'water' so it didn't leave a scent. (We have a stream beside our house where we got the water from).
It helped but didn't solve the issue. I also made a big deal of special 'no-monster' plants. I showed him which houseplants kept monsters away and let him pick out his very own for his room. That helped. Whenever he saw a monster in his room I reminded him that the no-monster plant was keeping them away.
We engaged him in all the steps so he would feel some ownership / power over the monsters.
We also spoke to his daycare provider and learned that the other kids were talking about monsters. So she helped to stir the kids away from talking about them when our son was around. (Not sure if he goes to daycare or is one of those lucky kids who gets to spend all his time with his grandmother) :-) I notice kids seem intrigued by monsters and probably are learning about their fear/flight feelings.
There are no scary movies - even the Cars movie scared our child. We watch really simple nice shows - Clifford, Curious George, Bob the Builder and absolutely no adult tv shows.
Our son is 3 1/2 now and we seem to be out of the monster phase but it was rough when we were going through it. It is heart-wrenching when they wake up trembling and screaming in the night. Hang in there, it will get better.