Pros: Creepy, generally well-made environment, great sound design, some good scares

Cons: Over-the-top in ways that made it impossible to suspend disbelief (silly eye surgery art, not even trying to close your eyes instead of cutting them out, producer thinking he can get away with getting the cameraman killed, etc...), lame and generic story, did not live up to it's potential 

Had there been more emphasis on the elements brought up in the early part of the game (the more realistic mistreatment of patients, which is sufficiently disturbing on it's own and would also explain the angry ghosts) and less focus on the eyeball-obsessed demon patient, it would have been a lot better. Actual historical mental hospitals did torture their patients, just not any of that stuff listed on the basement directory. When the scary is reduced to "psycho demon patient", it distracts from the real creepy elements inherent in old asylums. You could put The Peeper in a modern mental hospital,  or a hotel, or even a backyard BBQ, and the results would be exactly the same.