He may have been nicked once before and is remembering that - even if it never drew blood, he could've been poked by the tip of the scissors. Or maybe they just *look* scary to him, like how a large syringe looks to many adults. Additionally, it sounds like he feels out of control and helpless over something being done to him against his will, and the grown-ups aren't listening to him, which is pretty scary even if there's no physical pain.
He also may not like a drastic change because he looks so different in the mirror. My 3 year old is like that (but he's a little older and can communicate that.)
Some places that cater to children have a TV at each cutting station so that the children are more likely to be half hypnotized by the TV and not care as much about the haircut. But at this point, I doubt he would fall for that - he's already reacting so powerfully. I'd recommend completely avoiding the haircut experience for a looong time -- this sounds like the kind of thing where if you push it, it will just end up taking much longer for him to get over it because it's become a power struggle for him. The grown-ups always end up winning and he feels powerless, you know what I mean? If you stop pushing, he doesn't have anything to struggle against, and
it becomes his decision. Then it just becomes an issue of getting over the fear of the scissors.
First, let it grow out a bit. A longer, shaggy style doesn't have to be as precise so it's easier to trim, even if you resort to doing it with a flashlight while he's sleeping, which is probably your best route for now.
My mother did that for me & my sister for several years, but it's only going to work if you have a shaggy style that's more forgiving of imprecise cutting.
I never did the trimming in the sleep, but I do let my boys hair grow until it gets in their eyes and drives them crazy - then they BEG for a haircut. While it's long, I just make sure to dress them in clothes that are OBVIOUSLY masculine so they aren't mistaken for girls - no orange T-shirts, for example. (I'd never tell them, for instance, that "If you don't cut your hair, people will think you're a girl." Seems that would just be an invitation for a tantrum.)
Personally, I think little boys look adorable with a slightly moppy look.