"Mistuh Kurtz, he dead."

I agree that terror is a reaction to something tangible...while horror is, as Brandon said, the fear of the unreal or irrational. I can be terrified by a spider, but I am horrified at the thought of a spider.

...where horror implies revulsion or disgust

I also like this nuance of meaning for horror...like what I felt while watching John Malkovich incomprehensively butcher the character of Kurtz in the telemovie...it was as if he was just camping it up and walking through it, throwing it away because he had a tiff with the director and was out to spite him or something. And I wanted to scream at the screen, "You are a MUCH better actor than that! How DARE you do this to this great novel, you bastard, you!" I was truly horrified! Darkness descending......