When I was a kid, I watched a lot of horror games. This was one of the many, and I remember thinking I'd love to play this some day.
And then I remembered it recently. But not the name. I searched the internet, looking up things like "Horror game with smiling protag that's a mask" and "2D silent hill inspired game."
And I found it. Lone Survivor.

This game is heavily inspired by Silent Hill, and is a straightforward 2D survival horror game. But the plot is not straightforward.
If I have a word of advice: sometimes you just need to take your medicine and sleep it off, you know?
Great game.