Silent Hill 2 storywise is genius, shame about the repetitive gameplay, some poor game mechanics, and short lifespan.
It is not really scary as a horror, apart from a few scenes most people are so used to real and movie violence, that it does not really matter.
On the other hand saying that it is a survival horror or comparing to Resident Evil and the like is just scratching the surface.
The game works on different layers of perception, the most obvious one is the genre, but it gets way much deeper than that.
Every scene, situation, monster and act is a reference to something deeper; the game is a rollercoaster ride of self-exploration.
Many of the things referenced are too subtle to notice while playing and only make sense when the game is finished. Also many players will only ever realise that they kill monsters, something to do to make it acceptable as a game for the mainstream, the story is way beyond what most games or gamers dare to enter, including one of the possible endings.
Quite possibly one of the finest piece of mystery, horror thriller ever seen in a game, just as carefully crafted as movies like Angel Heart, Flatliners or The Sixth Sense.
Actually a book or movie maybe a better medium right now for the story itself.
Despite its faults as a game, I am glad that I bought it for the surreal experience it gave.
For some explanation of the references used in the game:
Only recommended after finishing the game, as it contains major spoilers.