I feel this film is open to interpretation, was the young Francis simply going insane? Is Dr. Caligari who he seems to be or a professor at a asylum? "a film of delusions and deceptive appearances, about madmen and murder" Roger Ebert, 2009. The design of the set contributes to the horror theme, not just because of the quirkiness but also the spacing. The small empty spaces with nothing more than (sometimes) just black crooked lines could suggest how confined we are to whats really going on; reality. It seems Francis breaks out of the 'confined space' and pays a consequence for it.
Wein has installed some conventions of the horror genre that we still see today. "often considered one of the greatest horror movies of the silent era" PublicDomainReview, 2011. With his set being diagonal and angular he has deliberately elongated the shadows to make the 'shadow-maker' seem more intimidating and menacing whereas the distressed victim, who is unaware, now becomes more vulnerable. It is the 'unknown' that gives this film the scare factor. I think Wein wanted to play off of 'your'e only aware of what is shown to you or what wants to be revealed to you' and if you are able to discover something (that you shouldn't have) what and if are the consequences?