I would give My Friendly Neighborhood a try - it’s very much in the vein of Resident Evil 4 with just-different-enough Sesame Street puppets that give you a jumpscare and damage when they make contact. Put together by John and Evan Szymanski (brothers to and collaborators with David Szymanski, of several New Blood titles fame,) it’s made explicitly to be horrifying without relying on gore and excessive violence.