Choose clothes that are tattered and will make the dummy look disheveled. The trick is to determine what makes real life humans seem scary, and then apply it to the dummy. Most people are repelled by and frightened of those who walk around in old, dirty clothes.
Apply makeup to the dummy's face. By drawing on eyebrows in an angered or furrowed way, you will immediately add to the dummy's horrifying effect on a crowd. You can also add a mouth that is contorted or crooked, and eyes that have abnormally colored irises.
Add disturbing accessories. Hats in particular can enhance how disturbing the dummy is. Military berets and helmets have a particularly masochistic connotation. Other accessories can be miniature shackles, a straitjacket, or a monocle.