Someone once taught me a great trick about conquering bad dreams that worked for me growing up, and now works for our young kids.
If they're scared about something BEFORE they fall asleep, then you can help them picture whatever it is as silly or funny. Take sharks, for example. My nephew started having bad dreams about sharks after watching Finding Nemo. Before bed, we talked about turning them into a huggable best friend, or a silly shark in boxer shorts who can't stop dancing. And, like magic, his bad dreams about sharks went away.
If your kids wake up in the night from a bad dream, the same process applies - tell them to imagine tickling that silly shark or playing hopscotch with him as they're drifting back to sleep.
Apparently, the same process applies to bad thoughts too. If you can't stop thinking about something negative, you need to give your brain a new image to replace it with that makes you happy instead of mad, sad or scared. For example, if you've accidentally closed the door on your child's finger, and you keep going over that terrible moment in your head, any time the thought creeps back in, imagine her happy face after-the-fact instead.