I am a mother of two grown boys. One was on a pacifier til he was 4, and he has no orthodontic problems from it, he is soft and sensitive and he is now 17, has a job, attends honors classes in a private High School, plays percussion in the band, drives a car, pays for his own cell phone bill, and has never given me a moment's trouble, and he loves his momma.....the other son has learned to meditate/pray through negative feelings. Your son IS self soothing by twirling his hair.
I suggest not making an issue of it. Your son will be ok.
Now that he has learned to soothe himself, you have him thinking he has a major problem. Try repeating only positive things- "I know you are going to rest well tonite", "Tomorrow will be a great day at school." Accentuate the positive- replace negativity and get him to concentrate on things he is good at and count his blessings. This was a nighttime ritual for us. You can lay in bed with him and think of all kinds of things to be thankful for- my pillow, my bed, my warm/cool home.... I am glad you have him talking, and he is not clammed up. This can work in a positive way.
The other thing is- anyone who feels helpless needs to feel there is a way to control that helplessness. Let him talk it out or write it out, or draw, or think up elaborate endings to mythical stories where he is the hero. You two can start the story together- you tell a little, then he makes up a little more of the story, never correct or change anything he says- he is in control of his part, but if it gets negative, go ahead and let it get dark, so that his heroism is even more relieving in the end. We read our kids stories about great saints. That might not be "your thing".... but you get the idea.
What you are seeing is anxiety behaviours. Since it appears that your son requires help in learning how to manage his fears/stress/anxieties, it is time to see your family doctor for guidance in this issue. If he/she is unable to help you, then ask for a referral to a specialist with experience in anxiety disorders. Anxiety is highly treatable and the earlier the diagnosis/treatment; the better the prognosis. Treatment usually involves intervention, therapy and as a last resort, medication.
Is your son pulling out his hair? If so, this is called trichotillomania - one of the anxiety disorders. I might suggest you google that term or "childhood anxiety" or similar phrases to find more information about this disorder. By the way, anxiety is an inherited trait - the episode at his cousin's place might have exacerbated the issue but I doubt if it caused it. And yes, you are correct in that anxiety will not go away nor will your son outgrow it (I believe you mentioned that you were scared these behaviours might develop further into a disorder - and without treatment, if anxiety is the issue, they will). As for the sleep issues, this is very common with children suffering from anxiety (as are eating, toileting, frustrations/tantrums and social issues). I wish you the best ...
can I ask you a question..?
Maybe it is time to sit down and explain real from not real. How people create monsters for fun or thrill of scaring others. Just because it is on a movie does not make it real. Ask him what movie it was that he saw. If you have not seen it watch it. Then try to figure out what in that movie terrifies him and reason it out with him. My 5 year old is terrified of "monsters" like all kids at his age. What I have come up with is luckily my uncle has a horse, and his name is monster. So I tell him Monster is a horse are you afraid of a horse? and he says no and we laugh. He has fears but it changes the face of the "monsters" he was seeing so now he thinks of a horse. His fear is reduced to I'm scared of the dark. Not as hyper of a fear as monsters lurking everywhere. How is a horse going to be under your bed or in your closet. That was my personal experience after my mother let my child watch a horror R rated film. Not the best of experiences.