All 3 Uses of

grotesque
in
The Scarlet Letter

The vulgar, who, in those dreary old times, were always contributing a grotesque horror to what interested their imaginations, had a story about the scarlet letter which we might readily work up into a terrific legend.†
p. 81.9 *

Carried away by the grotesque horror of this picture, the minister, unawares, and to his own infinite alarm, burst into a great peal of laughter.†
p. 140.9

Nor would it have been impracticable, in the observance of majestic ceremonies, to combine mirthful recreation with solemnity, and give, as it were, a grotesque and brilliant embroidery to the great robe of state, which a nation, at such festivals, puts on.†
p. 215.2

Definitions:

(1) (grotesque)
distorted and unnatural in shape or size -- especially in a disturbing way

or:

ugly, gross, or very wrong
(2) (meaning too rare to warrant focus)
meaning too rare to warrant focus:

More rarely, grotesque can refer to a style of art or instances of it that combines or distorts in a fanciful way natural forms into something that is often ugly or disturbing. Grotesque can also be used specifically to reference a gargoyle-like sculpture without a waterspout.