I was in a situation as the keeper recently where an investigator with the crowbar broke it over a monster. Now the crowbar was necessary to open manhole cover and progress the story. As the keeper, I just allowed him to discard another weapon and continue on, but I was wondering if anyone else ran across this problem. I am not a fan of having people lose because of dumb luck.

It's not an auto-loss. It does mean the investigators can't win if the Objective requires them to find Clue 1, but they can still hold on and prevent the Keeper from possibly winning, eeking out a draw. Also, they shouldn't have been using a critical object like that in combat to begin with, serves them right I say .

What if they have no clue that the Crowbar is integral to their success? That is a tough situation and I tend to allow something similar to what the OP does.

IIRC, Crowbar has the "Key" keyword, you do want to keep those intact until you use them on a lock/obstacle.

I do not remember where I read it, but it took my attention. When the crowbar or other key element to complete the story is removed from the game, by any cause, treat it as a card with no properties. In your case, you can not use the crowbar for combats, but you still keep the card to complete the clues of the story.

"Players should also be careful not to lose any key cards
that they have discovered, as doing so could make
winning the game impossible for them. Although it is
rare for a key card to be discarded, such an occurrence
should be avoided at all costs!" (p. 15)

So really it wasn't dumb luck but negligence on their part, and I should just laugh evilly at their predicament and overwhelm them with zombies since they have no where to run. Thanks, that helps.