What makes a first-person survival game truly horrific? When you're 100% unable to fight back. I'm not asking for a gun, but even Gordon Freeman got a wrench.
In Outlast, developed by Red Barrells, you must navigate your way through a psychiatric hospital filled with homicidal patients with only a notebook and a video camera. This has solidified my opinion that seekers of found footage belong in psychiatric institutions, but I wouldn't wish the inmates of Mount Massive Asylum on anyone.