I picked up the Horror Realms Pathfinder source book in a Humble Bundle, and have been reading it cover to cover. This is my review of the book, chapter by chapter. Chapter 2 is called Strange far places and it's about seven different regions on Golarion that are prone to some type of horror, so I'm posting reviews as I complete each section.
Farnvale is a small town located in Galt, a troubled region formerly under Chelish rule and now in a seemingly eternal state of revolution. If you know your Golarion lore, then you know that masked avengers called the Gray Gardeners normally try to police the towns and settlements of Galt. However, Farnvale is small and isolated, well out of view of the grassroots security forces. And what does it matter? Everybody in Farnvale is content, and life there is nothing if not mundane.
Incidentally, the horror genres listed for this location are psychological horror, body horror, and dark fantasy.
Farnvale is mostly a lumber town, so it's surrounded my dense forest. Within those forests there dwells a great and terrible evil, which I won't spoil here as it's likely to be the central plot your players are going to face when they visit.
This is a strong horror setting. The townfolk's complicity with the evil forces at play within and around their town is chilling, and even the kind town doctor, Cherise Allerique, has a dark secret.
I can imagine bringing players to Farnvale and get them out into the woods. Once there, I'd occupy them for a while with a woodland adventure like Tales of the Old Margreve or Fane of the Fallen, and then surprise them with the Farnvale plot. It's just too easy.