I really like what you've done so far! It controls well (save shooting the gun, which I don't think works quite right) and it instantly reminds me of SH2.
Hitting space at a sign with a text prompt up just repeats the crouch action (nice animation though); I hit it reflexively attempting to dismiss the prompt.
Lines on the character are an obvious blemish, but I like the filter.
Some of the camera angles last a long time when going far away (like around a corner), so you can't see yourself anymore and you're still moving forward. But maybe that's intended.
The ambient noise sounds very good but doesn't loop properly, there's a brief gap in there. I like all of the sounds effects, actually. The whole aesthetic is nice. Animations are a bit stiff, but it definitely hits on the "silent hill" feeling.
While I REALLY enjoy not being restricted when moving over varying terrain, it doesn't have enough restraint. I can scale the walls:
I walked around the flat lands looking for extra stuff for a few minutes before pitching myself into the light grey void:
The inventory clips through the ground/walls at certain camera angles. Or at least I think that's what's happening here. This was at the gun pickup spot:
If you're a bit too far to the right when you walk all the way to the top of the tower the abrupt camera angle change causes you to just walk off the staircase and fall down.
Anyway, I love horror games like this and I can't wait to play more! Keep it up!!