Yes, that is the line, and the episode, that I most remember about Treasure Island (though the illustration in the book when I first read it was much more powerful than that one, with a snarling Hands looking up)."One more step, Mr Hands, and I'll blow your brains out."
I think children's books divide themselves into three types: those which are and remain for children and are not really readable later in life (most of the animated books like Tintin, Babar, Bunter stories, Struwwelpeter, most of Lear etc); those which can be read either by children or adults (I'd put Treasure Island, Moonfleet, some of the Kästner stories, the better E Nesbit books, the Tolkien stories, some of Buchan, Rider Haggard etc in this category); and those which are really wasted on children, in which I'd include the Lewis Carroll books and Huckleberry Finn, or Russell Hoban's The Mouse and his Child. Children's books are unfairly looked down on by some who probably think it is easier to write one than it really is, requiring a particular skill and quality of mind (which does not mean there are not some pretty poor examples).
What struck me about the Tank Engine article was that imv it was someone reacting in a quite different way to the way a child would respond - the things that stand out for the writer are surely not what would stand out for a child. I can't remember being shocked or frightened by violence or cruelty in books I read as a child; for instance the Scissor-Man cutting off Conrad's thumbs in Struwwelpeter was not as striking to me as the face of angry Agrippa which seemed to occupy the whole of a large page. I think adults underestimate the extent to which children, accustomed to a world in which they have no power and see violence and cruelty (e.g. bullying) fairly regularly, accept that its appearance in books is simply part of that world. Books which seek to insulate and protect the child in some way do not make a strong impression (I thought this was true of the Blyton books, which I found unreadable even then).