At that age, I would think it was cute. My DS is the same age and likes to give kisses. My DD is 5, and she likes to hug and hold hands with friends (not strangers). I had to let her know a few times that she can't force people to hug or hold hands, but she understands now, and it seems like a non-issue at this point.
We had a neighbor girl who was 4 or 5 that would hug all the kids and parents, and something about it made me uncomfortable. None of us knew her well at all, and she would always come and sit in my lap and hug me and tell me, "I love you." She didn't seem to have any concept of personal boundaries, and I got an odd feeling from it.