LilithSlave said:
Yume Nikki is a popular free indie game that delves pretty strongly into the surreal mind of a quite depressed little shut-in girl. And aside from being meant for horror, the real horror is in the absurdity. It is a very trippy game. So much so that part of the scariness is that you're always expecting something bad to happen even though it never does. Also surprising for a Japanese game, it's heavily influenced by South American culture.
I'm taking it that you never found the "Game Glitch" event in the Zelda-esque temple? That was a pretty good straight scare. So was the infamous Uboa. She kills herself.
Also, add on Yume Nikki's spiritual sequel, ".flow". It's the same gameplay, except it's much more foreboding and has more real scares in it. Since the main character isn't dreaming (per se) in .flow, she undergoes some pretty awful things and presumably feels the pain (being beaten to a pulp, stabbed, clubbed, begins bleeding from absolutely everywhere, etc.). Make no mistake, though. It's still trippy as any acid trip. You haven't felt "WTF Paranoia" until you've crawled over every inch of a giant room where the floor is faceless highly-detailed mouths with grunty soundtrack.
Toss in Limbo, as well. The atmosphere is incredible for knocking you off balance.