The rulebook states: "If an investigator has suffered [x] -- whether faceup or facedown -- equal....."

It also states: "When an investigator becomes [x] ... discards all of his facedown [x]..."

It also states: "When an Insane/Wounded investigator has suffered Horror/Damage equal to or exceeding his sanity/health, that investigator is eliminated"

So, is an investigator eliminated a.) immediately if all of his horror/damage is faceup or b.) when he receives an additional amount equal or greater to his sanity/health? If a., then it follows that it does matter whether his damage is faceup or facedown -- contradicting the first rule. In that case, what's the point of drawing a wounded or insane card?

Here's the situation that makes me question all this:

I have two investigators at the beginning of a scenario. I took two turns to search things in the room. Now, on turn 4ish, due to and end of turn effect and the appearance and actions of one monster, I have one investigator with three facedown and one faceup horror and the other with eight faceup horror. I understand that RNG can cause crazy things to happen and this might be a fluke, but is it typical that I can have an investigator potentially eliminated in the first room ? If so, this seems to really kill the slowly building horror aspect that I enjoy from the original and would expect from this version of the game.

It is a fluke, but yes he's eliminated. I find it hard to believe that you received 8 horror from one monster in a room with 2 investigators (number of investigators doesn't matter much here, but for damage it would). Are you sure you're doing your checks correctly? And most cards that are drawn or flipped face-up will have a one time effect and then tell you to flip it face down again (this being very important as you've found out).

There aren't really all that many cards that remain face up once they've been flipped. I'm not sure what god-awful combo of horror check/mythos that you received to make this occur, but if all horror you have is face up then, yes that investigator is eliminated.

I have never seen this happen in 6 games. Perhaps your horror deck needs shuffled better?

EDIT: Actually, having just checked my horror deck cards... I only SEE eight horror cards with "KEEP FACEUP" listed on them. So this is highly highly unlikely.

Thanks for your response.

I was resolving things correctly. It was indeed a fluke....perhaps due to lazy shuffling on the first attempt. I played the first scenario twice after that. I had one person go insane and nobody eliminated during the course of either subsequent game.

You are doing this step ?

When an investigator becomes Wounded he gains a Wounded
Condition and discards all of his facedown Damage.
• If an effect cause an investigator to suffer Damage in excess
of his health, he suffers all Damage from that effect before
becoming Wounded and discarding his facedown Damage.

Same as insane.