This system is really, really good! It's clear, concise, and very quick to pick up. I can't wait to run this the next time I'm running a horror adventure.
The fight and flight rules are the exact level of lethal and exciting I want in a horror game, and I can already imagine a lot of situations playing out with them.
Spending Fear for "boons" is a unique take that I really like. Since you're only gaining 1 Fear at a time, you can mitigate taking permanent scars relatively easily—when I run, I might experiment with variable amounts of Fear so it's always a risk to accumulate it. But I'm really impressed with this idea.
Lastly, thank you for the shoutout to Swineheart Motel! I can see this system running the adventure PERFECTLY. I added a bunch of community copies for anyone looking for an adventure to use Fear & Panic with!
Cheers.