At certain ages... like now... a child, developmentally, develops 'fears' of night-time. Its normal...their cognition/imagination is changing....
Again, it is normal.
Do not scold or punish for it. You cannot 'extinguish' a child's mind...
Comfort him, let him have a flashlight IN bed with him, let him have a night light etc.
AND... specify with the Babysitter.... that he cannot watch TV... with the older kids/or her... and only age appropriate shows. Or none at all, if that is what you prefer.
Kids this age, can get 'scared' of anything...even bugs.
My kids are 3 almost 4, and 7 years old. They, at this age as well... get 'fears' of night time or things... that they hear from other kids. You cannot totally control what a child hears/sees... but, you can make sure that whatever it is is age appropriate.... if it is in your own home...
if outside influences are the triggers... then if you can, like the Babysitter... speak to her.
Age related 'fears' start at about 2 years old and continues.... on. Even when older. Even my 7 year old, got scared at night... because of what a kid was telling them at school... about ghosts/monsters/vampires etc.
A child the age of your son, for example, CANNOT differentiate between what is 'real' and what is fiction. That will come in time...
And yes, kids this age have night-mares. My 3-4 year old son does. I talk about it with him... he can remember his dreams... and he will articulate it.... to me. The next morning. Sometimes, he wakes at night, screaming/crying/scared. He will tell me it was a night mare. He does not watch scary shows on tv or anything. It is their imagination... or their minds/stresses etc. He once even had a 'night mare' where he was upset about being told "no" (by me) during the daytime... and in his dream, he was yelling back at me.... (although he did not do that when it actually happened). He said it irritated him that I told him 'no' earlier for a transgression.
So you see, anything, can tweak a child... hence, 'fears' or night mares... or their minds working things out, during sleep.
Talk with him about it... ALLOWING him to express his feelings... and comfort him.
You don't have to go to bed at 7:30... but you can tuck him in, sit with him in his room until he falls asleep. Then leave.
Or, if he really needs to, he can sleep on a mattress on the floor of your room. We have that too, for certain times.
all the best,
Susan