First, the module is top notch! One of GG's best. This 100% fits the bill for what your looking for.
Second, it could be run in a single night depending on your players. I would say it has about eight to ten hours of play time.
Third, I just logged on to comment about how this very module would make a great Calll of Cthulhu Mod. Funny, that you had that very question about it... Cool huh?
Fourth, This module BEGS to be converted to D20 Call of Cthulhu! Only MINOR modifications are required to do so. Nurses, Alienists, and hospitals are more "modern day" horror fare anyway, and running it as a 1920's mod makes a lot of sense. A secluded hilltop in Lovecraft's haunted New England would rock.
Let me suggest that if you do this as a one shot, then you pre gen characters before hand. I suggest 6th level characters for D20 CoC. this may seem low, but remember, PCs in this era have access to guns!
You can create characters of any level online easily here:
http://www.pathguy.com/cthulhu.htm
Now, to really add some 1920's atmosphere go here:
http://www.silentladies.com/Ladies.html
You can use the pics here to create all kinds of characters both PC and NPC alike. You can give your players a folder with precreated backgrounds, and a picture. This will get them right into it and save you tons of "setup time".
If you have access to photoshop you can make standups on cardstock, and create details patient profile with PICTURES! Put them in a manilla folder and label them... what great props... maybe yellow and burn them slightly.
As far as the background goes you could keep everything virtually the same, but move the time table up so that the events only occured ten years ago.
How the PC's get involved:
Let me suggest this, One of the PCs is a learned and well respected Alienist (in the 20s, psycologist were called Alienists), with a troubled patient. He has used a variety of techniques, but now he is seeing things he can't explain. He suspects that perhaps a reversion therpy (the patients faces the the thing he/she fears directly. In this case it would mean revisting Haverthold) is the only treatment left open to him. Though extreme, perhaps this will cure what ales the Doctor and his patient.
One of the PCs is the patient. A former nurse or orderly from Haverthold who survived the catclysm. He/she has been commited to the doctor's care as he/she has "delusions' that those that died still cry out to him/her, expecially in dreams. Thus, this patient sleeps little, futher adding to the madness. A great role-playing opportunity for the player... make sure this character falls into capable hands.
The rest of the players are students at Miskotonic University who have been called on to help the doctor. One could be a sensitive psychic, another could be an occult specialist with knowledge of the Cthulhu Mythos, and some spell casting ability... since your pregening characters you can make sure the spells will help in the module.
Except for the creature in the basement, this module is not combat heavy.
Atmosphere
In addition to the CD played on a decent sound system, let me also suggest:
Colored lights and candles. I can't stress this enough... lighting will add greatly. go to Wal Mart and pick up some blue, green and red lightbulbs and replace them in your lamps for the evening. Scented candles all around will add all kinds of atmosphere.
Masks. One of those "clear face" masks would be great. You could use the anytime you speak as one of the Ghosts in the asylum. Let me suggest you get one male, and one female. At halloween time I'm sure that you can find all kinds of scary masks to represent the characters... burned faces, skeletons, rotting flesh types.... CREEPY!

These would be great to use during the "interludes!"
Dress in black and wear silver jewelry. go for a "Gothic" look, it is halloween afterall! A lot of GMs don't think of themselves as a prop, but they can be. Remember, your players are going to be looking at you for most of the evening, how you dress will affect their mood, and set the tone. It may sound silly, but I'm telling you IT WORKS!! As soon as you open the door and great your friends, they will realize that this is going to be "something special."
Lastly, the ol' flashlight under the chin works great too!
Let me know if this helps!
Dave