see you later space cowboy
Ignoring the fact that the Necromorphs of Dead Space are mindless kill-crazy space-zombies, don't care that you can see them clearly, and aren't going to hide behind a corner giggling quietly while you stand there complaining about enemies refusing to stalk you like an imaginary yandere* girlfriend, let's talk about System Shock 2.
Being one of those individuals who had no interest in SS2 when it came out, I've spent the better part of my adult life listening to people off-handedly dismiss modern horror games as being "too much" like SS2. I finally borrowed a copy from a friend and do you know what conclusion I came to? SS2 is a barely average game more suited to the darkly cheeky humor of Portal (which rips off SS2 more blatalantly than Dead Space, not that anyone would call it out on that fact) than any claims on being the grandfather of modern horror games.
The controls are jerky, the game is buggy, the plot is paper-thin and gives itself away six hours before the "big reveal" scene, the inventory is a college dorm-room fridge of a mess and any sense of character development is ruined because your guns are made of tissue paper, hacking is the only skill that matters, and half-way through the game you get a powerful crystal melee weapon that will never degrade, and when you're able to beat hulking robots with missile launchers to death with what is essentially an alien baseball bat you're FAILING at the survival-horror aspect.
About the only real innovation this game can argue to have brought to the horror game genre is the inclusion of audio-logs meant to fill you in on the creepy goings-on that occured while you're character was asleep. Resident Evil had creepy journals and it was released a full 3 years before System Shock 2. The point is moot anyways, because its not like it was some Shakespearean leap to include back-story logs or even role-playing elements in a horror game; as the systems improved it was inevitable that they'd become prominent in video games in general; the concepts weren't going to be lost forever if SS2 didn't come along and do it. We don't hold up the first bread-slicer and call it the best just 'cause it did it first.
While we're on the subject of audio, let's talk about GLaDOS- I mean, SHODAN. In the first System Shock she was an honestly disturbing villain because she was in control of the station you were trying to escape. In System Shock 2 she's an extra-naggy Simon Cowell confined to a wheelchair, telling you to run out and do her errands while she sits in her computer eating all the virtual pies, ruining any sense of dread or loneliness you have (not to mention the fourth wall) by reminding us what putrid sacks of meat we are. Unlike the aformentioned GLaDOS, SHODAN has no deeper character nor an ironic sense of humor that points out her own flawed logic. Her antagonistic attitude would be more interesting if she weren't so flat, predictable, and evil for the sake of evil. Remember how they tried to do that in Dead Space 2 - the antagonistic voice of your former lover that can pop up to annoy you at any time like the laughing dog in Nintendo's Duck Hunt? Gets old fast, doesn't it? At least in DS2 they tried to shake it up near the end of the game, leaving her intentions temporarily ambiguous.
Oh, and if the Necromorphs are too unsubtle, how would one classify cyborg zombie ninjas in a horror game? If you were intentionally making a self-depreciating parody, then they're pretty awesome. They're the Reb Brown of survival-horror video games. But in a game that wants me to take it seriously, it's as subtle as fighting Albert Wesker at the end of Resident Evil 5: I kept waiting for a remix of "One Winged Angel" to break out. How does System Shock 2 offer more scares when it boasts perfectly lit corridors and its monsters announce their presence from ten meters away?
Dead Space (and games like Doom3) isn't perfect, but hate it for its own faults. Don't compare it to System Shock 2. The similarities are vestigial at best, Dead Space is far more consistent and polished in gameplay and narrative, and SS2 just can't hold up when you take a modern critical eye to it.
*Yes, I had to look this term up. Yes, I had to look on a hentai site.