Twiglett - just to add another voice of support. My ds1 is similar in age to your ds (3 yrs 2 mths) and to be honest I don't think he's old enough for the cinema yet.
Not so much from the being scared thing, but because although he can watch a feature length DVD at home, until he's watched it several times he asks CONSTANT questions about the plot. I find it annoying, so goodness knows what the people sitting near us in the cinema would think!!!
Also, in almost all the films we have, even Shrek 1 there are places where he needs a cuddle through the scary bits. I expect that while he can cope with them with a cuddle and in the comfort of his own home, in strange surroundings where the noise is very loud I'm not convinced he would be able to remember that it's "just a film" and that he's safe (actually, I'm not convinced he realises the DVDs are just a film either ... I don't think they can separate fact from fantasy well enough at this age).
Different children are ready at different ages. By the time he's at school he'll be begging to go see the same films his friends are seeing and I don't think he's going to miss out horribly by not going this young.
I just think we're going to have to wait to see Shrek 2 on DVD or con MIL to do some babysitting while me and dh go and watch it by ourselves