It's not a horror game.
Anyways good to hear it sold that well and like a previous poster said it's probably over 2 million if you count the bundled downloadable codes. Didn't Forza 3 sell almost 1 million more because of those bundles. Good to hear it's a great game.
It's very much a horror game.
It's a "Psychological Thriller" according to both Remedy and Microsoft I have played this game so many times that there is nothing scary about it. There are some heart pounding moments when surrounded by the taken and you just have to run to a light source to get away from them but I really wouldn't call this game a horror game overall.
Doesn't matter if you'd call it a horror game or not, it's still a horror game. Silent Hill 2 was also pegged as psychological thriller, but you won't find many (if any) that will argue that it's not a horror game. Remedy also admitted they had inspirations from past horror franchises that worked. If you truly have played it as much as you say, you'd remember the references to movies like The Shinning & other Stephen King works that do more than hint that you're playing a horror title.
I don't want to get in a tit-for-tat on semantics, but hardly anyone would argue that Wake isn't horror. It is and was treated as such (go to any horror gaming website and find Wake all over the place).
If anything, I'd argue that HEAVY RAIN is much less a horror game, but even some go as far to peg that as one as well.