It's basically like mental BDSM. The idea that Mowgli starts each encounter so totally stubborn but, through only Kaa's charisma and powers, he winds up happily submitting each time. Kaa never gets violent or demanding, but he still totally dominates Mowgli each time. Hell, divorced from the context of Kaa wanting to eat Mowgli, it looks downright pampering. Each time, Mowgli winds up completely coiled, unable to escape on his own... and he enjoys it the entire time.
WITHIN the context of Kaa wanting to eat Mowgli, it gives it that peril thst can scare a kid and really stick with them... and make the scene exciting as an adult. It adds tension, the fact that Mowgli is being lulled and seduced by someone who wants to hurt him.
All this alone would be enough to make the scene a fetish staple. But the last piece of the puzzle is, the movie makes getting hypnotized look FUCKING AWESOME. Mowgli starts out sleepy, but each time he gets a huge grin, eyes wide with excitement, and stiff legs with curled toes. Any kid who notices it will probably make a connection to orgasm the first time it happens, since it's pretty close to how they imagine it feeling.
Also, Kaa is insanely easy to put into any setting you want since his character is so simple. There's no plot set up needed- he's a hungry snake, he can hypnotize people, boom, done.
Look user it's like this. Everyone has what can be called a "sexual awakening". Now that term gets a lot of flak and many people debate it's existence but from what I can see it seems to be the truth. Anyway, a sexual awakening is when you first become really fully aware of sex and sexual desire. You won't necessarily know when it happens but it tends to be what causes fetishes. For example seeing a really hot girl that you like slowly and sensually taking off her footwear and socks might give you a foot fetish. Seeing that same girl eat a banana might give someone else a vore or eating fetish. Seeing that fucking snake mind rape a little girl in a well animated segment of a cartoon gives some people a hypno fetish. Seeing snidely whiplash tie a girl to some traintracks might give someone a bondage or peril fetish. And so on and so forth.
The reason the snake gets a lot of people into hypno is basically what said
There's nothing intrinsically wrong with it because everyone can potentially have kinks but it is important to understand where they come from.
That fake wizard sort of hypnotized Luz into thinking she was the chosen one in episode 2.