Does covering something ugly with something cute rid it of it's inherent ugliness? No. Like a new slipcover on a ratty old couch, even if it's outer covering is adorable and sweet, underneath, it's still a run down, ratty old couch.
There was a time when we used to take our kids trick-or-treating and participated in all the cute Halloween stuff. However, does making it cute rid the day of it's inherent evil? Truly, it IS "just another day." It's not a Biblical religious holiday, so it is a day that is just as common as any other. So what does it matter if we dress up in adorable (sometimes) costumes, and go door to door, begging treats from our friends and neighbors? What harm is there in that?
On the surface, it is harmless...it's cute and fun, just like the new slipcover. But the reasons behind WHY these traditions started are not cute or fun at all. It's still the same old nasty couch underneath. Is it really okay for our children to be groomed to accept these things as normal and fun and okay? As a society, I think we're blurring the lines of right and wrong for our kids; we're sending mixed messages. What could Halloween mean to a young, pre-teen girl dabbling in witchcraft for fun? As a kid, I know myself and most of my friends participated in something like that at some point, and usually it revolved around something having to do with Halloween. I want my children to know what dangers lie lurking beyond these seemingly harmless spells and chants and where the traditions of this day come from, so they aren't duped into thinking it's all just harmless fun. Beyond a certain point, it's not just fun and games anymore. And for the struggling teen girl (or boy), what if in a few years down the road, it does turn into something more? Does she know it's just another day, like any other?
Some people have been unknowingly led to believe that this is a holy day. There is a difference between what the Bible considers holy compared to what some churches and denominations consider holy. Holy means set-apart; October 31st is not a day that is set-apart for the Lord anywhere in the Bible. Some faiths have deemed it to be a holy day for their religion. I guess the concern there would be whether or not you're content to follow the teachings of a church if they're creating (or in the case of Halloween/All Saints Day/All Hallow's Eve/Day of the Dead/Hallow mass/Fall solstice, re-creating) their own holy days without precedence from the Bible.
There is no harm in having a dress-up party. For most people, that is why they love Halloween...it is fun to dress up and get together with friends and be silly. There is just no reason why it is good for us to do it in association with these cultic celebrations and there are plenty of reasons why it can be harmful. Let's become set-apart from these things. Do a fund-raiser costume party or do it just because. Just let it be completely unassociated with cultic rituals. Those who have come out of the Wiccan religion cannot understand why people, especially those who claim to be Christian, would want anything to do with these pagan celebrations. Here are a couple short videos that teach us more about the cultic practices that are what we now call Halloween.
A little more info on the original cultic practices that are behind Halloween.