At Fossil Butte National Monument, in Wyoming, restrooms are decorated with coprolites, which is prehistoric fossilized poop from 52 million years ago, found in the area.
The first time my wife (girlfriend at the time) went to my parents house my dad showed her his coprolite collection. That was over 20 years ago and she is still with me. So from my scientifically significant sample size of one, I can confirm that it indeed works.
Most fossils happen when something gets covered by soil or sand or whatever before it's had a chance to decompose. Over eons, the organic material gradually transforms into stone, but it retain it's shape.
I understand how fossils work, but I assumed that scat would be more likely to break down compared with flesh and bone. If you see scat in the woods it's usually gone by the next day. otoh, if it were placed before a massive dust cloud landed, I guess that the lack of oxygen would slow the process.