Monster Party was horror? No, I actually haven't played it but there's a feature on it on FlyingOmeltte.com, a site mainly dedicated to old-school games and reviews and it looked more like just a gorier than usual NES side-scroller, not really intentionally horror since all the bosses were cartoony.
Alright, I'll bite. Clock Tower is the one of the only games to ever truly frighten me and it didn't even have to do a whole lot for that to happen. Whether made full 3D on a next-gen console or remade the original for DS it could work very well if they kept the supernatural powers of the heroine and British voice acting to a minimum (Alyssa in Clock Tower 3). Nothing but a normal girl trying desperately to escape a madman with huge garden shears who has bloodily killed all her friends and seems capable of tracking her down wherever she runs.