I don't understand what is so funny about your kids screaming and crying in fear. This is a thread of torture for your loved ones.
Uh... no. No, not at all.
First, the parent's point of view. Kids, as I am sure most of us well know, are the least predictable creatures on God's green Earth. You do not know how your kid is going to react to anything out of the ordinary. Which is to say that
none of these pictures were taken with the intent to capture terrified children and laugh at their misery. I'm fairly certain that they are the unfortunate (but funny in hindsight) end-product of waiting in line for hours and hours and having to get at least one picture off to make it all worth it. (The going to see Santa at the mall stories people have brought up often are terrific analogies.)
I had a table at Boston Comicon this weekend and there were many costumed characters wandering the floor. After a while, I got bored of watching them and instead watched the reactions of the really little boy at the table run by his mom and dad across from us. Sometimes he was a little freaked out, sometimes he was happy. And most of the time -this is true- he had this exact expression on his face:
(As if to say, "What is this, I don't even...?"
)
Which brings us to the child's point of view. See, when you're a very young child, your understanding of the world is pretty limited. The younger you are, the less it's going to take to freak you right the heck out at a moment's notice. Therein lies a possible explanation as to why some kids flip out upon meeting costumed characters face-to-face. The sudden revelation that Mickey Mouse is real and, by the way, an oddly proportioned five-foot-tall creature with a skinny humanlike body and a big, giant head whose expression never changes certainly pulls your minimal, but still fairly reliable understanding of reality right out from under you. You do not have the words for what you are experiencing, so all you can do is scream and scream.
Or,
to put it more succinctly (sorry for the swearing).
But here's the thing, and it's super important:
Kids recover from these little earthquakes right quick. Doubly so if the encounter with the character is over quick and mom and dad are right there. And heck, look at all the pictures from character meals where the kid is scared at first, and then once they notice the character hasn't done anything scary or hurtful, they're totally fine with them.
In short, what LuvTheMouse said (quoted below). This, this, this, a million times this.
I'm also amazed at how much some people coddle their kids. If you try to protect them from every little thing, you end up with Nervous Nelly kids who grow into Nervous Nelly adults.
My mom has pictures of me with Santa 3 years in a row where I am not feeling the love, LOL. In one you can see my tonsils, I am screaming so much.
I am not scarred for life. Santa doesn't send me into fits anymore.