The "horror" genre in anime has pretty much become a misnomer over the years; rather than attempting to be scary in any way, shape, or form, the animes almost always attempt to develop a slow, interesting and gruesome story. When the genre works well, it fosters a kind of morbid fascination in the viewer. Despite the fact that not a lot is happening in these shows, what does happen can be very interesting indeed. However, when the genre fails, the anime comes across as cheesy, predictable, and boring. Every horror anime walks a very fine line between being appealingly dark and appallingly absurd, and when an anime crosses into the ridiculous, much of its charm is lost.
Following this trend closely, Mermaid's Forest is both pretty good and pretty bad. Almost all of the plot lines are thoroughly ridiculous and logic-defying; never before in an anime have I seen a plot that contradicts itself so much in so many ways, and some of the story elements used are laughably cheesy (lost souls in particular come to mind). Yet, at the same time the anime managed to consistently hold my attention for the entire time through. The gruesome nature of the show combined with some clever (though way too predictable) plot twists do a pretty good job at making the storyline worthwhile.
Unfortunately, the plot and characters really aren't quite good enough to carry the anime by itself. Annoyingly, the anime is mainly episodic in plot. Essentially, the anime has seven totally isolated stories that have little to do with each other. The ending is too unsatisfying, the plot is too fractured, and the dark mood is broken by absolute absurdity a bit too often. As someone on animenfo has already said, most of the characterization is devoted to the villains of each plot line. Almost no time is spent characterizing the two protagonists, and as a result they feel disappointingly flat and empty. Only the creatively thought out villains manage to illicit feelings other than apathy. Of course, if the technical aspects of the show were excellent, then the plot and characters would be more than enough to make a good show. Unfortunately...
Visually, the show is pretty mediocre. The hero's character design is so generic that it looks like it's out of a hentai show, and none of the other character designs are particularly good either. Probably the worst are the lost soul designs, which are some of the stupidest monsters that I've ever seen. The animation itself tends to be pretty clunky and half-assed, and worst of all, when violence happens in the show (and it happens often), there is literally zero gore. When one considers that the anime is attempting to be dark and gruesome, this exclusion of gore is absolutely baffling.
Fortunately, the sound manages to be a little better. Voice acting is competently done, and the music is unmemorable but decent. The two protagonists' voices are pretty well done, and add a surprising amount of character to the unimpressive character designs. As a whole the sound is still nothing to really rave about, but there's nothing really bad about it either.
Nonetheless, I enjoyed Mermaid's Forest a bit too much to flat out condemn it. While Mermaid's Forest is riddled with various weaknesses, the macabre style of the show ended up being too much to resist for my misanthropic soul. If, like me, you enjoyed Vampire Princess Miyu and Pet Shop of Horrors, you might want to check this one out. This anime is very much in the same style, and Mermaid TV's animation isn't quite as crappy as its predecessors'. However, if you were bored by those animes' style, then you should probably skip this one in favor of some of the flashier shows that have come out lately (insert shameless plug for R.O.D TV here).