I know this topic is kind of old, but I still wanted to clear up the question of the storyline up for once and for all.
I had the chance to play this game a couple of times because I stayed in Japan for avbout a year and am almost leaving. I finished the SHArcade 4 times so far. Twice with a friend and twice alone. I got the good ending 3 times and the bad one one time.
Eric, Tina and a group of friends (the scoobies) from the paranormal club from some college decide to go to Silent Hill for a field trip. They get help on this from a man and his daughter.
One night when Eric is asleep, he dreams that he gets pulled under water by arms and sees a girl being thrown into the water from aboard the Little Barones, a boat that disappeared a long time ago.
When Eric wakes up, all his friends are gone except for Tina. They save one of their friends just outside of the Inn, and continue on with a radio in their pockets.
When they are close to Brookhaven they hear a door slam, and go inside. Inside they see a little girl but she runs off and disappears.
After a misthorn sounds the hospital ends up dark. Eric lights a lighter and nurses jump out. After walking around they hear Jessie, one of their friends, scream.
After they run into a room, they stand eye to helmet with Pyramid Head. After shooting him and some bugs off, Jessie appears.
Then Jessie gets covered in bugs and you run off a bit. Then Pyramid head picks Jessie up by the throat. After you shoot him a bit, he drops her and comes after you. After some running and shooting, Pyramid raises his sword... and turns into a fan. Jessie will be either alive or not, depending on if you shot PH when he had her by the throat.
Then when going on you'll see the little girl who helped the Scoobies around SH running away from a scraper and disappears to a place where Eric and Tina can't come.
After some more running around, one of the rooms start shaking and Eric and Tina go to the roof where it came from.
They find the girl, and a big winged monster standing behind them. After you kill that thing, the little girl will take you to the Historical Society, where here father is a caretaker.
In between we meet the little girl who was thrown in the water. A sick girl Hanna, whose mother takes care of her. Her mother thinks it's a good idea to go to the lake, because it's been such a long time. After this flashback, our hero's are inside the Museum.
Here we find out after a while, that Eric's great-grandfather was the Captain of the Little Barones on the day it sank. After the museum, our trio will be abused by the big worm from SH4. You can't actually kill it, but it's a good source for some extra points. After this it jumps out occasionally.
After some more running around and reaching the prison, we find another friend inside inside a bag, hanging from a rope. As soon as you release him, the floor around the platform changes into filthy water, and you'll be attacked by the Splitworm, but now it can dive, jump, splash and body slam you. After you beat him, your hippy pothead friend will comment about how filthy the place is. After this a bit more of the Prison will follow.
Finally, the three heroes will arrive at the underground graveyard, which to Tina's opinion "smells moldy". Another friend makes an appearance here, but is soon dragged of into the darkness to be replaced by a big mannequin-like spider. After killing it before the timer runs out, your friend seems to be alive and well inside one of the graves. All he needs is a corny hand to help him out of there. Eric is happy to help him up.
After they leave that moldy place, the little girl hears her mother calling for her. She runs off despite Tina and Eric's messages of caution. As they run towards the docks, the Little Barones appears out of the fog. The little girl runs in, followed by Tina and Eric. The interior of the boat makes place for Heather's place of choice: The Mall.
Here you get attacked by a new enemy: The Numb Body.
Sometimes we see the little girl running by. Also, some easter eggs to SH3 are in this part. The Ladies Toilet makes a strange sound when you walk past it, and the the Telephone that Heather used starts ringing after you just passed it. After this you'll hear memories of the sick girl, hanna, as you progress through the last part.
When our heroes enter the subway station, a flash occurs, and we are inside a train. After some shooting the train will come to a stop.
Somwhere in between here (not exactly sure where) We see a scene of the non-sick girl (whose name I forgot) is sitting in the hospital. The doctor is talking to her dad. She has some serious issues involving her mom apparently. When the doctor asks for her name, she sais her name is Hanna (which is the name of the sick girl)
Meanwhile we arrive at Lakeside Amusement park, where we'll be abused by lotsa Robbies.
Not much to report here story-wise. We walk through the park untill the merry-go-round, where a Robbie will be sitting on each horse, throwing an axe at you.
After this we switch back to the Hospital, where your vision will switch between fog, normal enemies (nurses, scrapers) and Pyramid Head. This part of the game ends up in a closed off area where you'll be fighting Pyramid head for the last time. After abusing Pyramid head, we find ourselves onboard of the Little Barones.
The little girl runs towards a woman who resembles Hanna's mother ALOT!
Suddenly the girls father is there too. He yells at the woman about what she is doing to his daughter. He then tells his daughter to stay away from the woman, because she is not her mother.
The girls looks at her father as is he's gone mad. Then the truth comes out: "Your mother is already dead!"
The "mother" looks pissed off, and her hand has gone green and skeleton-like. She then nocks out the girls father in a single blow and throws the girl in the water.
Eric wants to jump after her, but Tina stops him. "What's the big idea?" she asks.
"If we don't stop it now, it will never end" Eric yells, and they jump in.
Inside this Underwater-world we see the sick girl Hanna standing with a Teddybear in her arms. She looks ffing creepy, and changes into a medusa-like head with an arm coming out of her mouth.
Now you have to kill her. After shooting her in the snout a couple of times, some arms will pop in front of the head. If you destroy all of these AND the head, you'll get the good ending.
When the head dies, Eric sees Hanna going under. He grabs her hand just in time to save her. Hanna sees the Captain instead of Eric. He helps her up.
"It's alright now", he tells her when she starts crying.
After the scene, Eric and Tina seem to be in a forest bathed into sunset sunlight. The little girl and her father are sleeping there. Eric and Tina seem to be satisfied that the nightmare is over and they think that the girl and her father will be safe there. "They'll be fine", says Eric's voice actor.
After the cut, we see Hanna aboard the Little Barones with a teddybear on her lap. The captain comes over and talks to her in Eric's voice. (
Hanna is afraid her mother doesn't really love her. The captain is very optimistic, and exactly at that moment we hear Hanna's mom calling her name.
The captain gives Hanna a look that says: See? I was right, she DOES love you!
Hanna then runs off smiling, turning around once to wave at the captain.
If you don't destroy the ghost hands in the final bossfight, you'll see Hanna drown, and Eric won't save her. After the cut, Eric and Tina fins themselves in a foggy forest. They have no idea where the fuck they are. Then the radio starts giving off static. Eric listens to it, and Hanna's voice comes out of the box. "Why didn't you save me?" she asks, followed by an EPIC FAIL game over screen with no chance to submit my score.