Not a sidescroller but it dealt very well with limited technology back in the day. Silent Hill 1 for Playstation. You could draw some inspiration from it, the scary barely visible scenery, scary situations with and without violence, etc.
What mechanics or aspects about it would you say made it scary? Perhaps include some examples and explain its shortcomings as well.
Currently speaking I don't have the time or resources to play the game, much less get a playstation.