The franchise needs to be rebooted. Honestly, the way the story has progressed beyond 4 is terrible. The global awareness of the bio terror and the subsequent special forces teams are more home to an action game instead of a horror.
Resident evil needs to return to its roots, being terrifying. They can keep the more action focused controls and still be scary. The problems lie in the level design, story and setting.
The franchise can be saved, but Im not sure if capcom actually has the talent to make it happen...