I think we need a pronunciation guide here. Since I'd pronounce that the same as Kawaii. While I like the link that all cute things are inherently scary, I'm sure that's not linguistically the case.
The romanisation of Japanese is almost always pronounced in two letter pairs: a consonant followed by a vowel (the exception being single vowels or the single n/m sound). Take each pair and pronounce... Does that help??
Hence kawaii -> Ka-Wa-i-i (with the i being pronounced e and stretched for the double ^^;;)
Kowai -> Ko-Wa-i (similarly but without the lengthened i)
AlexChurchill has noticed that the two words do tend to be pronounced almost identically. But not quite. There's no real schwa sound in Japanese - so kawaii starts with "ka" rather than "kuh", and "kowai" with "koh" (all Japanese sounds transliterated "o" are pronounced long, at least in theory). And also, as the spellings suggest, there's an extra "i" (pronounced "ee") on the end of "kawaii"; however this is almost unnoticeable when it's spoken, normally.