The Enemy Within

Rating: 7/10 (21 July 2006)

"Nightmare..." is, perhaps unavoidably, most directly derived from "Psycho". "Carnival of Souls", "The Haunting", "The Entity" and "Altered States" are suggested.
The center of this is Shakespeare: "The sins of the father are to be laid upon the children..." ('The Merchant of Venice'), which in turn came from classical and biblical sources. 'Hamlet' is also directly referenced. These are wedded to Grand Guignol excess.
The acting and dialogue are almost toe-curlingly bad. But those aspects are forgivable, because they are compensated by the rather clever idea of the movie itself being a 'nightmare' within nested 'realities' -- Craven toys with us by confusing each level of reality with the others.
Also quite clever is the construction: Freddy is Craven's alter-ego. The demon enjoys frightening the characters within in precisely the same manner that Craven enjoys frightening us -- a nesting of realities by self-reference.
It wasn't the low budget that kept this from greatness, though. What's missing is any sort of interesting camera perspective or movement. The editing is competent, geared towards maximum jolt effect, as we expect from the horror genre. Other than that, it's mostly ordinary hand-held footage, par for the course.