Paul, this really does capture the Silent Hill feel. The thing that does it for me is the "What is in this room making that sound, oh hi! now I am going to get the fuck out of here!" moment you captured. Silent Hill is all about atmosphere, and your team absolutely captured that. Really looks wonderful as well.
My only criticism is that it maybe feels one step too much like a video game. Maybe it is possible to still get this sort of feel and still do it in one shot but capture a few more close in moments that really let you feel what the character is feeling, without felling like you are controlling the character?
I would love to see a Silent Hill game or movie based in Japan. But there just aren't enough underground mine fires I would imagine. ;) (Lots of subway stations though, hmm....)