Okay, it's slowly clearing up and giving her no obvious signs of discomfort. she's not sickly, off her food, strange smell from her pee, discharge or any other signs of illness? Is the spot hot to the touch?
I am not a vet nor an especially experienced dog person so please do take other opinions over mine but it doesn't sound overly worrying to me. Personally, I'd carry on treating her topically but keep a very close eye on any rise of any other symptoms.
Some dogs are more prone to skin problems. Skye is allergic or was when she was younger to some mystery summer trigger. She'd come up in hives which were serious. The reaction could have closed her throat and she could have choked to death. So skin problems do need to be monitored carefully but if it is localised, not giving her pain, not putting her off food or water and seems to be subsiding of it's own accord, then I'd guess you are doing the right things already.