How about if you do a split design? Have all the gritty stuff on one side; boilers, blood spewing bed, Freddy, etc. And the more dream sequence-y stuff on the other; white gowns, feathers, a goat (it was a goat, right? or was it a lamb? been a while since I watched the first film) and Heather. The house could be used on both sides, like the porch could wrap around the pony. You could have the trellis in there too.
This might be too involved but, it would neat if you could have something that could be moved from one side to the other, representing the scene where Tina gets dragged up the walls (easily my favorite part
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