Sounds fine to me. It is a straight shot from the school to your house. He walks most of the way with other kids. He is only walking alone past six houses. I assume you live in a decent neighborhood - no crack houses on the route? If he is a responsible kid, I would absolutely let him do it.
My nine year old dd1 recently has been allowed to ride her bike to the park with a younger neighbor girl. She takes a Motorola pager (Costco) with her and we keep one at home - so she can "call" us or vice versa. It is seven blocks, straight shot.
My kids also ride the bus to and from school. Bus stop is two blocks up the hill. When dd1 was a kindergartner, 1st grader, 2nd grader I didn't let her ride as it was more of a hassle for me to sit at the bus stop with a toddler, often in the rain, waiting for the bus than it was just to drive her to school. When she was in 3rd grade - and the neighbor girl was also walking the same route - we let her ride the bus home. So no waiting for the bus to come, just hopping off and walking straight home. Now in 4th grade they (dd2 is in kindergarten now) ride it both ways so they do wait there in the morning. It is not in my line of sight but they are together and we kind of eased into it with the riding home thing last year.
Start slowly - with what you and ds are both comfortable with and build from there. What helped me was to remember that when I was ten, I was riding my bike miles from home and gone for hours and hours - with no pager or cell phone or anything. We had more responsibility as kids, were given more freedom. I know bad things can happen. But I think bad things happened when we were kids too. I want to do what I can to keep my kids safe while still letting them be kids. Walking home from school is part of being a kid. I'd let him.