Everything about it, from the slow, deliberate way it moves, to the creepy, serene smile on its face, to the nail sticking from its neck.
Even worse, we never learn what it does to its victims making it an example of Nothing Is Scarier.
Grip of the Shadow Plague
Secrets of the Dragon Sanctuary
Warren getting trapped in the knapsack. We never get to see the world from Warren's POV, but imagine waking up to find that you're suddenly trapped in a one-room Pocket Dimension with no contact to the outside world. His allies also have no way of retrieving him. He gets rescued in the next book, three months later.