I didn't think about Munch's freakiness. What you guys say makes since though. Mudokons have probably never seen a gabbit, or at least one so far inland trying to be friendly, so they consider some strange freak-show commodity.
As for meeps being only scared of Munch, I think that is wrong. The meeps run from Abe too. They are sheepish creatures

and would be startled by anything they are not used to.