An excellent essay and appreciation of The Blair Witch Project. I agree it is an influential classic, but I've never been a huge fan. I liked it, but much preferred The Sixth Sense, which was out in cinemas at the same time.

I completely agree with what you are saying about the best horror films leaving plenty of space for mystery and the imagination. Uncanny events are often less alarming the more they are explained. And I do think a lot of the times, gore is best left offscreen to make matters scarier (eg Halloween, most of the deaths in Alien, etc).