I may be crazy for thinking of it, but the fact that a) This movie contains a scene where the lead character goes to the movies and apparently watches this film's predecessor/his life story, after recounting parts of it to a psychiatrist in the same movie, and b) Nobody in this film acts like a believable human being both suggest some kind of influence on IN THE MOUTH OF MADNESS. That or it's just a bad movie.
I've watched some commentaries from the crew, and they tried what they could with their small budget, but half (!!!) the movie is footage from the previous one, narrated by a character that was either a baby or not there at all. Terrible. The other half saves some laughs due to hilariously awful scenes, and what is seriously the best overacting I've seen. That man's eyebrows deserve an award.