If you play in my games, don't read this.
A few people seem to read the thing as a glowing review of James Raggi's LOTFP adventures. That's not quite accurate: This is what I believe these adventures aspire to, the reason why James Raggi does things like curse the PC's as soon as they look at the dungeon. It's an ideal, not a documentary, in the same way that the Old School Primer isn't a literal description of how people played in the 80's. The adventures themselves often fall short of the mark for me.
The most obvious problem with the concept: the DM prepares a Negadungeon, and the players sensibly take one look at the thing and decide to run for the hills. As in this review of Death Frost Doom, where the DM forces an unwilling set of players to complete the module, or this session report where the players flee Tower of the Stargazer and the DM has to improv the rest of the session.
The interesting thing is that I haven't heard this complaint of horror modules for Call of Cthulhu et. al. Any sensible PC would take one look at any horror adventure, call the police, and fly out of the country. They don't do it because they know what they're here for. The DM has made a horrorshow, they've made PC's for it, everybody's gathered around the table with the understanding that the PC's will fling themselves into the terrible situation at hand like the characters in a horror movie.
I think this is the greatest problem with Negadungeons, but also the greatest source of potential. The obvious thing to do in making this killer dungeon would be to force the players to do it, right? Lock the door behind them, or put it on the table and say "We're running Death Frost Doom tonight, everybody get ready to die." - the approach that makes Call of Cthulhu work. But the approach Raggi takes - where the players have to actively seek out the place, often in the middle of a campaign, and push past the people trying to stop them - has the potential to make the players responsible for their own doom. They weren't forced into it.
I'll give an example. Spoilers for Spec Ops: The Line.
The Line is a video game that pretends to be a Call-of-Duty power fantasy. It's a trap. As the game goes on, it slowly turns into a Negadungeon. The turning point is a scene half-way where the player commits an atrocity. After that, you start dying, going insane, flying down the slippery slope to the point where you find out it was all for nothing. The player is meant to feel horrified and guilty for all this. Loading screen tips start saying "This is all your fault."
The problem with this guilt-trip is that it isn't the players fault: If you want to play the game, you need to commit the atrocity. (The game's writers claim your choice here is to turn off the game and walk away: this is the good ending.) This is analogous to playing a horror module: You force yourself to make the bad decision because you've paid for this game/your DM has paid for this module. You're making a meta-game decision that leaves you immune to shame and horror. Of course this isn't your fault: You just wanted to play the game you paid for.
The potential with allowing the players to walk away is that it is their fault if they commit the atrocity. Having a genuine choice means the PC's can feel genuine guilt, knowing that they were sent down this spiral because of their own greed and doomed obsessions - not because you wrote "You have a doomed obsession" on their character sheet. You haven't shot them in the head: You've just given them the gun and allowed them to shoot themselves.
Of course, pulling that off is going to be difficult. In practice, Death Frost Doom relies on a cheap trick to get the players to orchestrate their own doom. It should be their greed that bought them down here - but it's more likely that they just felt like they had to play the adventure their DM prepped. They'll fall for the trick either way, and they probably won't feel like it was their fault.
If I made a Negadungeon, I would make the one discussed in this thread. The trick: it's a normal dungeon that can become a Negadungeon if the players make the wrong choices. If they don't take the bait, you still have a fun adventure to run through for the evening. Because you have that fallback, the players don't feel forced to make decisions for meta-game reasons, and you haven't wasted your time prepping a dungeon they'll never play.
The Finder haunts/ These twisting hallways/ His sightless eyes/ Can see you always
I've realized not everyone can read the thread I linked. Here it is.