Dead Space,the FEAR series (My first 360 games),are overrated.I only jumped once in Dead Space when the tentacle first came out of the wall,and I once did get scared briefly in FEAR:Extraction Point when approaching the dead Delta Force soldier in the hospital to pick up his ammo and health,only to have something violently pull his corpse into the ceiling.Though that's it.
The games I consider actually scary are Fatal Frame,Call of Cthulhuark Corners Of The Earth (It's on Steam for $10),and LSD:The Dream Simulator.(Has nothing to do with the drug,the "LSD" in the game's title stands for 20 different things in-game,though the D always stands for "Dream".
Here's the infamous Ramona scene from Call of Cthulhu (Make sure you watch all of it):
that last part didn't come through.....but i would have to agree with everyone else