Bumping this because I like this suggestion. An Unreal World/Dwarf Fortress-style health system would fit this type of game much, much better. Also, a little more realism, eg. a bottle of disinfectant should only disinfect a wound, not heal it.
Also more body parts would be nice. Would give the game incredible depth. Here are some suggestions for them:
Keep the existing main body parts, just add some more (eyes and mouth already exist for head).
Head: Eyes, mouth, ears, nose, chin, cheeks, jaw, forehead, skull, neck, throat.
Body: Chest, stomach, ribs, lower back, upper back, spine.
Arms: Shoulder, upper arm, forearm, elbow, wrist.
Hands: Inner hand, outer hand, can go into individual fingers DF-style if you really want to.
Legs: Shin, calf, knee, thigh, buttock, hip, groin.
Feet: Ankle, outer foot, sole, toe.
Can also add organs inside the body. Yep, I really like Dwarf Fortress that much.
Lastly, different body parts affect your overall status differently when they are hit. A cut to the wrist and throat would more likely lead to bleeding, a blunt attack to the knee can cause you to fall down, etc. Don’t be so squeamish. It’s a horror game.