It takes place during modern times, the main character was just kidnapped after a car accident and put into that old fashioned dress.
So the screen gets all weird when you touch an enemy, Fiona will start acting crazy after a certain part and fall down a lot, and you can hide under beds and wait for the enemy to leave while looking in a first person view. Eugh, Clock Tower 3 was more tedious than fun and Demento is going down the exact same path.
Note to Capcom: Don't even fucking try to sell this in America at $49.99, it's just stupid.