Some people consider this a proto-giallo. It kind of is, in the same way The Girl Who Knew Too Much resembles a giallo, actually it's a 'woman gone missing' mystery shot in black and white where a lot of the usual giallo tropes are absent for the simple reason they had not been mapped down yet; the same movie made ten years later would have probably been shot in garish Technicolor, the murders would take place on screen and we'd be treated to the black-gloved hand of the murderer. A lot of common giallo themes can be found here though, sexual obsession, distorted memory, a chain of events is unlocked when a character visits a place of his past, the boundaries between reality and fantasy/madness blurred by something that may or may not be a product of the mind, yet I'd place the movie closer to the psychological horror Polanski was yet to do than Mario Bava, or a movie that would influence the gialli of Sergio Martino more than those of Dario Argento.
If you take it apart to study the parts it was made of, you'll find a lot of familiar ideas reconfigured together in similar ways in other movies. This is the type of movie where a fiction writer (who is "dead inside" by his own admission) arrives at a remote town by a lake to look for a girl who presumably committed suicide a year ago, the town streets are empty and there's talk of a family harboring a "terrible secret", the writer stays at an old hotel where according to the suave-creepy owner "he's the only resident" because it's off-season, at some point a photo of the dead woman is presented that throws a new light into the situation, and there's a mysterious slaughterhouse behind the hotel that looks like the abandoned warehouse Nosferatu hauls his coffin to in Murnau's 1922 film.
The movie does a lot of something I find annoying: a scene where people behave in odd ways or has a certain kind of offbeat atmosphere plays out and then we cut to a shot of the writer jolted awake in his bed back at the hotel. Bazzoni is a little too quick to point out "DREAM SCENE!!" to his audience, a little too quick to reassure the viewer that "this part that didn't make sense wasn't really supposed to" so that as the movie begins to morph into something else we're lulled back to the safe environment of the genre picture, where the protagonist can narrate his thoughts in voice-over and where 'dream scene' appears to be the director's way of saying "I want to shoot with the whites washed out".
But even that is not what it seems, because at some point we get the flashback of a memory of something that happened in one of the writer's previous stays in the hotel, the writer walks up the stairs and spies on a love scene between the dead woman and a man he can't identify, and we get extreme closeup shots of an eye watching this through a keyhole. Later this memory is expanded upon in the writer's mind and what we saw at first suddenly takes new meaning so that the love scene may had not been a love scene and the victim may had not been the victim after all, but it doesn't become clear whether this is a repressed memory unlocked by circumstance or a wish fulfillment dream, the writer furnishing a twisty conclusion worthy of one of his pulpy books to an incident that remains unexplained and ambiguous like most real life situations usually are. Fittingly this new twist feels very film noir, deceit and greed is involved and for a moment the moral universe of the film is turned on its head.
This is what I take from the Lady of the Lake, like the blurry photo that is only a magnified detail of a larger frame, the sense of mystery partially revealed to us for a moment then withdrawn from our eyes again. Now the mystery is ours, literally to inhabit the memory. Or better yet, there's a strange melancholy woman in a white coat who walks by the beachwalk every night by herself and we watch her stroll under the lamp posts from the window of our hotel room. One morning she's found dead and if only we'd have gone down there to talk to her while there was still time.
Near the end the movie shifts from eye-level Shining track shots of hotel corridors to vertical shots of the protagonist going down a spiral staircase, the whole geography is now inverted, and we're invited inside the mysterious slaughterhouse for the big reveal. There we get portrait shots steeped in shadow and claw-like hands emerging in silhouette from behind a white glass panel. It's all a bit like we're seeing the seedy industrial locations of Tetsuo through the wintry viewfinder of Sven Nykvyst, or like fetish filmmaker Maria Beatty had brought her inky blacks to the glowy diffused whites of Funeral Parade of Roses.
For the end the movie feels the need to explain itself and provide a definitive conclusion, with the villain recounting the whodunit details to the protagonist, and then in very melodramatic fashion a crazed woman is running down the beach, arms flailing wildly. The Italo-horror fan will savour the whole thing start to finish, but there's enough surreal oddity here to make even the Last Year at Marienbad crowd sit down and take notice.
