We have a saying when we disagree with another family's parenting decisions: "Everyone gets to ruin their own kids in their own way." This means that if you do Halloween totally differently and think we're nuts, that's OK. We think you're nuts, too.
We do Halloween as All Hallows Eve. The kids dress up as saints (this years details and pictures to be posted). Many people we know will groan "It's just a fun kid holiday everything doesn't have to mean something!" We do not eliminate all scary stuff from the holiday. This week we made little haunted houses where you open the doors and see scary stuff inside. We carve pumpkins and we allow scary faces. (nothing super scary or gross) Other people will now groan, "You've sold out!"
Here's our rationale (or rationalization, if you prefer): Halloween, for us, is also a celebration of the glorious fact that we do not need to be afraid! Pre Christian religions, as they were actually practiced, were terrifying. It's horrifying to live in a world where the gods are capricious and vengeful. They might demand the sacrifice of your child and then still not send the rain. Maybe you did it wrong. Maybe you did something else wrong. Forget a personal relationship with a deity, you'd better hope they don't notice you. And then there are the other things around. We've watered down the stories of fairies. The "little people" would steal your baby and leave a changeling. I'm not saying never pretend that fairies are cute and sweet, just that people who had to live with them as "reality" did not find them so. And what about death?
Jesus said, "Be not afraid." We don't have to be afraid of death or evil spirits, or even of God. He is the light of the world and he chases out the darkness. That's really worth celebrating!