Vall: I was hired after the Falcom partnership had already been established, so I'm not really sure.
As for what "flavor" of horror it is, and what games it's most comparable to... well... that's hard to say, as it's kind of unique.
The games it makes me think of most are probably Shadow of Destiny (Shadow of Memories in Europe) and Clock Tower, but for very different reasons.
Gameplay-wise, it's a lot like Shadow of Destiny -- it's basically an RPG without battles. You go around examining things, talking to people (ghosts, in this case), picking up items, flipping switches, etc., and the story advances based on the decisions you make -- not just multiple-choice decisions, but also decisions on which rooms to enter and which to avoid, which objects to examine and which to avoid, what order things are done in, etc. And it's not like if you make the wrong decision, you just generically die and get a game over... no, in this game, every single death is a unique, drawn-out, horribly disturbing ending, and the sheer variety of ways in which you can die (and how long those deaths last, making you more and more uncomfortable by the second!) is pretty staggering.
And it's like Clock Tower in terms of general mood, where most of the time, you're just exploring the school and nothing of note is happening... but you know that that could literally change at ANY moment, so you're CONSTANTLY on edge, never able to relax because some sort of hideous death could lurk just around the next corner.
And the fact that it's 16-bit-style in its visuals actually adds to the horror of this, as the sprite animations are actually quite detailed... but they're still tiny sprites, so a lot of the finer nuances of your hideous, gory demise are left to your imagination. And as we all know, the things a person imagines when he/she is scared are far, far darker than anything your eyes could ever see.