Things that would have made Amnesia scarier

[Cranky Old Man]

The removal of the story.
Unless they're Silent Hill masterpieces of story, I think stories detract from horror games in general.
While playing Penumbra: Necrologue, I kept thinking back to the Penumbra Demo: You happened upon a hatch in the middle of a snowy wasteland. Maybe it's Greenland. Maybe it's the North Pole. Maybe it's the South Pole. Maybe it's actually the sum of all three, or whatever you find scariest in your head.
Then, underneath, you happen upon some kind of underground site. Maybe it's a bunker. Maybe it's a polar station. Maybe it's a mine. Maybe it's a monster research lab. You don't know, and you don't know how big it is. All that you can do, is pay attention to the walls and environments around you, and deduce your own theory. You do this instead of reading boring leaflets of people working until something scary happens to them off-paper. They can't actually go "OH, no! It's that scary monster! Aaaah!", so all you get are the boring parts of their everyday lives.
...but in the Penumbra Demo, all you needed was darkness in your face. Like two meters in front of your face. ...all the time. ...to the point where you became convinced that the monster lurking down here, was all around you, in the form of sentient darkness, that would pounce at you with shadowy teeth and devour you, as soon as you reached its gaseous belly area.

Every word I read in a horror game does three things:
- It takes me out of my own predicament, and puts me into the shoes of some worker who doesn't even have it as bad as me.
- It turns the game into a text game, which makes me sigh from boredom.
- It destroys my deepest darkest fears by setting borders on my imagination.

Penumbra would have been better if there wasn't even a monster in it (although those giant spiders made me unable to proceed without watching a walkthrough). It would have just been me and the darkness and my deepest, darkest fears. Maybe some music and creepy noises to keep me company.

The REAL story, according to me, is in the environment. If it looks believable, like an actual habitat that you can really envision people having lived in, for instance, and an environment that has a clear function, then that's immersion right there. You don't need people writing journals and reports. At most you can give the player the occational ACTUAL report, like "Main Output Drain: 80 GW - Aux Output Drain: 5 GW - Grid A Drain: 45 GW - Grid B Drain: 40 GW - Fuse Replacements Total: 5"
Nothing that would actually tell him anything more than he already knew from watching the environments.