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One of the key things though is to remember that the Muppet Show wasn't really marketed as a kids' show. IT didn't discourage kids (There was the Sesame St. audience, after all), but Muppets were also famous for being on SNL, and the show booked counterculture-type stars that might also be on late-night TV, so adults wanted to see it too. I seem to remember it was on Sunday nights (is that right?) in prime time, so it was really an all-ages show, with humor for the adults that went over kids' heads, but lots of slapstick and character comedy for kids too. Brilliance all around.
It was definitely a show for all ages. I remember watching it with my entire family as a small child. My dad was a BIG fan and always used to roar with laughter at it. And I remember this scene, and it didn't bother me at all.
My parents were fans too. We watched all together. I remember not knowing or caring who a lot of the 'stars' were - I was watching it for the muppets and the gags, they were watching it for the celebs and the sly humor.