Neil is a djinn, posing as a male nurse to the comatose Mr. Rawling. Before coming to the Rawling house, Neil was visited by Michael and given the ability to "read" his victim's nightmare and make them real. Neil captured the hunter Maggie and kept her captive in the house's attic, draining her blood as well. The djinn told Dean that he was one of dozens of "raps"--supercharged monsters--that Michael had left for Hunters.
Eventually Dean recognized Neil's blood-draining equipment and confronted the djinn. Neil attempted to read Dean's nightmares but was overwhelmed. Dean didn't have a blade dipped in lamb's blood--the traditional way to kill a djinn--handy, so beat Neil unconscious with a bookend and then shot his brains out. As the brothers found out years earlier, sufficient brain damage will also kill a djinn.
Neil is apparently the second version of the djinn. The first version exude a poison that cause their victims to hallucinate their greatest desires. The second version's poison cause their victims to hallucinate their greatest fears. All of Neil's victims suffered from their great fears rather than their greatest desires.
