To add to what Ladydance said, you will not only plateau, but you will suddenly find you get *worse* at something you thought you knew. This is normal as your brain and body integrate new information. You can only progress so much based on what you were able to do. Practicing means you improve, so you're now able to do more... sometimes that means rebuilding technique that you already knew from the bottom up. This is normal. Enjoy the process.
As to nerves for competition.. Well, you are probably dancing because you enjoy it. It's fun. I hope? So, it's a competition. Dance because you love it! At the end of the day, not only will you have enjoyed dancing, but you're a competitive dancer!! You already surpassed all the people who ever stayed in their chairs.
Results, well, win or lose, a) strive to improve, and b) there will always be someone better, if not in this category then the next! So b) is not worth worrying about unless you are an elite athlete and this is your life... and even they are doing it because they enjoy the process! Focus on a). So what if you came in 4th instead of second. Did you dance better than the last time you performed? Only you know that. That is your real goal. Competition is just a way of forcing us to work on that.