Pass the dusty cheese, please... Jesus, this was creepy! The atmosphere in this film is genuinely terrifying and keeps you on your toes, constantly trying to assess what is real and what is mental illness / psychological trauma / paranoia etc.
I find it interesting that kids are such a popular element in horror films. I mean sure, they suck the life out of you, but there's probably more to it than that. A demon child / doll is one of the most horrifying things I can think of. Maybe It's the combination: ultimate evil in an innocent package?