This sounds very familiar as my dog started like yours, it started with a small rash on the inside of his back legs and being very ictchy and scratching.
Not being able to get to the bottom of it, i had a rast test done and it turned out to be allergies to numerous things.
my friend also had a similar prob with her bitch and it turned out to be anal gland probs which can cause itching and scratching.
Hope you can get to the bottom of this, as i know it can be very distressing for you and your dog , it could also be a food allergy or something in the enviroment as my dog turned out to be allergic to all red meats, dust mites, perfume, diary products, wool and plastics please pm me if you want any additional advice, my dogs doing really well now with management of his allergies .
'God turns clouds inside out to make fluffy beds for the dogs in dogs heaven,and when they are tired from running around and barking, the dogs find a cloud bed for sleeping, god watches over each one of them and there are no bad dreams'.