Don't worry, GF - I have a Dreamcast and Resident Evil: Code Veronica, and I first played it with my wife, my brother, my sister and her boyfriend all in the room. At that exact scene - when things explode in the graveyard and the zombies attack and start eating - EVERYONE (except me) screamed at the top of their lungs so loud that I jumped half a foot and dropped the controller. My brother and my sister's boyfriend were so embarrased that they had screamed like that!
Anyway - unless you like being terrified, its a good thing you didn't continue playing. The next big scene involves something hiding under the stairs while your character walks down them...