There are plenty of modern horror games with PS1 graphics, from Dread Delusion (which is Daggerfall meets Demon's Souls). Richard Aiken has gone back to the source with this first-person version of the original Resident Evil, complete with pixelated zombies.
Though not complete, in the current beta you can explore the halls of Spencer Mansion with WASD controls and headshot zombies with your mouse like God intended. It's being made in Unity, and is currently so bare bones you'll need to press Alt-F4 to quit, but it's neat that it even exists. As Aiken's itch.io page carefully notes, "This game is made only for fans and was made without any intention to make profit."
If you prefer the more polished HD look of the modern versions, there's also someone out there with a project in the works to Resident Evil 8 in third-person. You've got a lot of options is what I'm saying.
