Having read this to my six-year-old son, I can say it's definitely not TOO scary. We laughed (both of us), got excited (both of us), and generally loved every minute (both of us).
Had I thought it was too frightening, there's no way I'd have read it as his bed-time story, but I'm happy to report there wasn't a single nightmare. Quite amazingly, for the first time ever he actually asked to go to bed early one night, so we could read the final three chapters.
Other reviewers have given a break-down of the concept, so I won't go into it again here. All I'll say is that both I and my son thoroughly enjoyed the adventures of Luke, Resus and Cleo, and we'll definitely be picking up the rest of the series.
Highly recommended.