No. The legal argument is that the airline is not an absolute guarantor of a fun, care-free travel experience, or even an experience free of fear. There is no free-standing right to sue another party just on the basis of something happening that one does not like or enjoy. There must be a legal category of "duty", which the claim alleges that the party being sued has breached, or another similar category of legal right and corresponding legal remedy. (Sorry to get all pedantic, but you asked.)
There are people who become very upset and fearful when they travel by air, sometimes with knowledge of this tendency beforehand, sometimes without such knowledge. Do they have a right to claim legal injury because the plane took off, it went very fast down the runway, they felt the aircraft turn and bank, they were scared?
What's different here is that the engine failed and presented a pretty scary sight on the wing. But while that obviously occurred, the airline did not, in my view, breach any known, existing duty (in the legal sense of that term) owed to passengers. It had complied with all mandated inspection timelines and procedures, for example (I'm assuming this would be factually correct). It operated the flight in accord with all required rules and procedures. And the pilots .... well, that's been said already more than enough times.
It's just not feasible to say much of anything worth anyone's time to read, dissecting the notion that many parties who are sued over nonsense claims nevertheless settle just to get rid of the nuisance. Just this: paying to get rid of nonsense claims does occur. So do hard-headed courtroom tactics that work out to much the same as "loser pays" attorneys fees of the vindicated defendant.