Did you see The Blair Witch Project? The premise of the movie was that this was real footage shot out in the woods. The effects of the shakey camera, the close-ups of the camera being turned around and the person seeming to film themselves. We were supposed to feel like it was real.
For some, that was what made it so scary: thinking that The Blair Witch Project was real. By the time I saw it, I had read on some obscure website that it was all a fake, so I was only annoyed by the movie, not scared.
But, other movies are following in the footsteps of The Blair Witch Project.
Paranormal Activity took this same approach.
Apollo 18 is another such movie: supposedly made up of “found footage” to show that there has been another lunar mission that we don’t know about. Apollo 18 is scheduled to be out in theaters on April 22, 2011.