I doubt that he is scared of Linux ... after all ... these OS wars are largely religious.
My own experience with Linux has mirrored Ken Thompson's (see attached link) ... some of it is written well, much of it isn't. BSD varients have worked much better imho and I'm looking forward to see what OS X is 6 months from now.
check out this link for comments by one of the Gods of the computer world (and a much better designer than Linus)
http://www.computer.org/computer/thompson.htm
"Computer: In a sense, Linux is following in this tradition. Any thoughts on this phenomenon?
Thompson: I view Linux as something that's not Microsofta backlash against Microsoft, no more and no less. I don't think it will be very successful in the long run. I've looked at the source and there are pieces that are good and pieces that are not. A whole bunch of random people have contributed to this source, and the quality varies drastically.
My experience and some of my friends' experience is that Linux is quite unreliable. Microsoft is really unreliable but Linux is worse. In a non-PC environment, it just won't hold up. If you're using it on a single box, that's one thing. But if you want to use Linux in firewalls, gateways, embedded systems, and so on, it has a long way to go."