Yes, but you must heal the steg to full first. It is not permitted to use the spell on it if it was ever ridden by a character however.
Any normal unit can be targeted, noone gets revived untill all wounded guys are healed, it is indeed the rules for the spell. The spell is also not allowed to be targeted on characers or their mounts. Therefore i rule
As long as part of the unit remains the whole unit can be regrown back to its starting streinght. Loosing the crew off a steg is no different than loosing all the skinks of a skrox unit, in the end the unit is still there to be regrown, it also works on hunting pack handlers.
I believe it works on the crew and monster of special or rare steggies and the crew but not the monster and character of character's steggies.