Based on an H.P. Lovecraft story of the same name, Nightmares In The Witch-house is a solid second entry in the series. The story has moved from being straight slasher into being less slasher and more nightmare.
A grad student rents the cheapest room he can find, where he can work on his schoolwork quietly. He finds what seems to be some sort of dimensional portal in the corner of his room (not a vortex or anything, just an odd convergence of lines). He befriends the lady in the room next door, and her baby boy. He eventually becomes manipulated by the witch, who seems to be doing a series of bizarre rituals toward an unknown end, but it involves using the student to sacrifice the baby boy next door.
What I mean by saying that the episode is more nightmare than straightforward slasher is that the horror is not based so much on being in a difficult situation as it is about being unable to control your actions. This is a nightmarish quality when you know that if you open the door in your dreams, you'll be scared, but you do it anyway, almost out of your control. This idea is a theme throughout the movie, but it's not as trumped up as I thought it could be. I'm reminded of the movie The Game (Michael Douglas one from '98, I think) which I always considered to be a horror, in a certain sense. The character's control over the environment is lost, leading to a near-nightmare situation. I've read a bit of Lovecraft's work. It mostly seems to be roughly the same stuff. But I looked into it, and he went through a few different phases in his work. While there's no mention of Chulhu here, there's the Necronomicon, thus firmly tying it together with his other work. It's ultimately a good episode. I've seen it twice, and my only beef with it is that the sound varies too much in volume.
