Blair Witch was pretty scary at the time, but has not held up well. It was perhaps the first seriously successful online viral marketing campaign. Widespread web access was still pretty new, and the site was pretty convincing, like something a local researcher or historical society would put together. The invention of the entire myth and local lore was brilliant including even news clips of the local sheriff discussing the disappearance of the kids, photos of old documents, etc. Anybody who explored the site before the movie, would have had a much more founded fear (albeit, one founded in fiction).
Too many movies since have tried to capitalize on the shaky footage gimmick, and now it's just annoying.