What's so scary about Sesame Street?

I was thinking around Halloween about horror or disturbing stories. I wondered about scary situations I may take for granted that could be reinterpreted or were possibly misinterpreted from the start. I didn't have to go far. I was thinking about a neighborhood where some of the people are real but some of the people aren't. Nobody seems to be able to tell the difference no one cares. There is some good here, everyone gets along extremely well. I thought about a crabby old dude that literally lives in a trash can and no one ever thinks twice about it, it's just accepted. Even though he's seldom glad to have visitors, people continuously bother him. I think he amuses them. I thought about two dudes who live together but they seem to have almost nothing in common and they don't even realize they are total puppets for someone else's agenda. A monster? Every scary story needs a monster. In this case, he is big and blue and hairy and his main focus is eating cookies. I believe he may be involved in controlled substances known to increase appetite, but it's never addressed. To top things off, the neighborhood has a giant bird bigger than all the people who just shows up. Nothing is big enough for him and he couldn't fit through any doors but everyone thinks it's normal. I think I have the base for a very disturbing story, maybe even a series.