Ohh... the creepy is stron with this one!
Let's start with the theme- it seemed a bit "normal" at first, but the creepyness factor elevates it to the top. The monster wants to "hug", so he really isn't an invader, he's a guest! Visiting friends!
The pictures representing stater are top tier! Really awesome. The pixel art is ok, but very hard to distinguish (I know, it's night, and you can use the paranoia, but still). The audio design is better- the music fits, the "hug" sound is properly meaty (meaty? I meant friendly!).
As for the gameplay- I feel you had an ambitious idea, and only four days to deliver. I think this game would really benefit from some polish (like, maybe change the states with number keys). As it is, I felt I was fighting the game controls almost as much I was fighting (no! hugging!) my enemies (friends!!).
Over all- ambitious project, that could use more time in development. Loved the atmosphere though!