Do I need to change my settings?
I get a very harsh warning saying things like "Terrain 5 miles ahead, Climb above 1,400ft" the thing is, I'm flying at 2,300ft at the time (actual heights may vary). I get a similar thing with obstacles. I don't mind a reminder, but flashing red box? It's very distracting.
Is it my settings? 
I'm hoping for a gentle reminder to tell me where to look and what sums to do

Thanks

Warnings like that are driven by settings, so yes, it's your settings. For a start, terrain warnings are disabled by default as SkyDemon is VFR software.

You can change the thresholds for obstacle warnings in your Navigation Options.