Do you mean are they too young to read the book? ALW's version is loosely based on THe Phantom of the Opera by Gaston Leroux (I'm sorry I dont' mean to insult your inteligence, but it sounded like you wanted them to read the libretto which is different than the novel). I think with some guidance it would be fine!
I think it is great to introduce them to opera (or any fine arts) at a young age. Though many of them deal with death and some form of sex, you would just have to make sure they are appropriate. A modern musical that is great is Into the Woods. It is as if all the fairy tales were thrown in a blender and then a very specific moral was pulled from that. It is fun and approachable (read: in English) and the themes are easy enough to discuss with the kids.
My 2 cents,