I am only vaguely familiar with The Theater creepypasta, but really enjoyed this game even without real knowledge of it. I am not usually creeped out by video games, but there were moments in this that made my spine tingle, it was really well done. The sound design especially really sold the experience for me. The voice work was great, and the building up of ambient and dreadful sounds really begins to gnaw at you.
I highly recommend checking this out, it is a very cool and unnerving experience! You also get multiple movies for a dollar with this, how can you beat that deal these days?! ;D