Like everyone else, I think your son will warm up to the dog in time. Labs are big and rambunctious. I have two elderly dogs so my kids get a little intimidated by younger dogs because they have so much energy. It's probably just as well he doesn't want to be left alone with the dog because even the most gentle of dogs can accidentally hurt a child being playful--play biting, knocking them over, etc. Would your son like to have a special job to help care for the dog that might make him bond more quickly? Help change his water or something? Throw a ball/play fetch? When our kids were younger we would sometimes sit with the kids and dogs together and pet the dogs together. The dogs won't always sit for the kids, but they will sit for us and that allows the child to pet the dog without the dog getting too excited.
I also think it is perfectly normal to refer to "adopting" a pet and don't feel bad about that. Humane societies and rescue organizations use the phrase "pet adoptions" all of the time. My brother and his wife are in the process of adopting a child and I don't consider it demeaning to refer to adopting a pet. Best wishes.