I think the best way to cut the Gordian knot of "What makes a better length for horror -- short story or novel?" is to say, "Neither: The novella is best." These tales are each about 80-90 pages -- long enough to develop character but short enough to sustain mood and a tight structure. All three are good, but the standout is Ray Garton's Dr. Krusadian's Method, which takes an unflinchingly radical approach -- including actually fixing the problem -- to the theme of child abuse. Dana Anderson's novella is about an endless surreal party amidst demons and angels, and Charles de Lint's is about longing for love across the veil of death.
Used availability for David G Hartwell's Cafe Purgatorium
June 1991 : USA Hardback
February 1993 : USA Mass Market Paperback