Incinerator, Morgue, Outside
While we now have the shotgun, ammo might still be a little low, depending on your luck. Jack has buggered off for the moment (and long may he stay so buggered), so you might take a quick cruise through the house to look for loose ammo. The Drawing Room with all the hunting trophies is a good place to start (though the crow door remains unavailable)
When you have all the ammo you're likely to have, return to the incinerator room. If you didn't before, be sure to read the note over the sink for a journal entry, and snag the Strong Chem Fluid peeking out from beneath the metal table near the entrance.
Just as regular Chem Fluid can be combined with gunpowder to make handgun ammo (as we all learned in Chem Ed), Strong Fluid can make extra strong ammo. Or strong meds when mixed with a Herb. If you're still low on shotgun shells, consider some enhanced pistol ammo to make up the difference.
The note on the board tells the location of some constant escapee (far left compartment, which is locked), and the combination to unlock it. The 3 a's referred to have to be in the same name however- no mix n' match. None of the visible names have 3 a's, but open the far right chamber to reveal a fallen label for 'Tamara.' Bingo. Then open the compartment with the red handprint, and you'll see the far left compartment unlock, but not fully open.
Ready a weapon, because the moment you pull this drawer out is the moment you'll be attacked by a Scyther, a supertough moldy, with enhanced endurance and special Scythe Arm action.
You can get in a few headshots as the drawer slides out, then use standard headshot-retreat tactics. Be aware that this guy takes a lot more shots to go down then the average Eddie Brock wannabe. Still, even if he's tougher than his kin, he's no smarter. Once he's down, return to the incinerator to snag the Dissection Room Key from Travis' bunk.
It's too bad he was all rabid n' stuff- we could have worked together to tear our way out of this madhouse. We'll see you in a better world, Travis.
Key in hand, leave the incinerator room and make for the steel door just before the green barricade - the one we didn't want to open before.
There's some ammo in the nearest tub, but move slow and careful. There are multiple Moldies waiting to manifest, and they can get tricky when they team up.
Still, calm shooting will win the day. Just don't rely on an infinite retreat- these moldies will deliquesce once they reach the room stairs, but they're not dead, they're just waiting to reappear when you get deeper in the room again. So make your shots count- taking out the two here, the one lurking in the next corridor, and two in the boiler room beyond that. If you can spare the shotgun ammo, a close blast to the head will be instantly fatal (and frankly, they'd probably thank you for the mercy, if they could).
Once these room are cleared, you won't have to fight anything else until a triggered boss battle coming up. So loot thoroughly, then move into the room beyond the boiler room. Loot the locker to your right, then attempt to pick up that final dogshead.
It's snatched away by a cutscene, but things could have gone worse for you there, considering. Follow the passage to the morgue, looting as you go. You can reach the room where the deputy's hanging (still can't use his radio), as well as go down the stairs past where the final dogshead is hanging, as an obvious trap. Still, once your pockets are full, the only way forward is to go back up the stairs & take the bait.
The next fight is a bit of a pain. For the first few minutes, Jack is effectively invincible- just dodge and weave away from him. Kicking a corpse into him will slow him down a bit, but also keep in mind that you can slip in between the bodies and pillar- Jack nearly always goes around them. Keep this up long enough, and Jack will eventually grow as sick of it as you are, and liberate some motorized hedge-manglers from behind some wire-mesh here. There is an achievement for ducking an attack from these, so approach Jack from the left as he's picking them up, then duck under the obvious swing.
Lure him away, then grab the chainsaw from the same hole in the mesh. Now you're in the fight. The chainsaw can attack, block, and execute a powered thrust by holding both mouse buttons. Some of these actions may cause it stall, in which case the reload key will get your engine humming again.
Get enough licks in and Jack will collapse while his head goes all giga-tumory. He's defenseless now, which makes it an ideal time to get close and inflict maximum damage. Rinse and repeat until you've cut him to bits.
Loot the arena for a first aid med and at least one other ingredient before going to the exit. You'll use the chainsaw to saw through the bar here (wrecking the chainsaw, alas).
You now have free run of the house- or at least the parts you've already been to. You may also notice that Grammy-Grams has moved again, this time lurking just outside the scorpion door safe room.
She still doesn't attack you, and you still can't attack her, so save, sort your inventory, and move on. Once you feel you've cleansed the house of its immediate secrets, head to the front door, slot the last dogshead in place, and step outside, earning a breath of fresh air and a shiny new achievement (You Ain't Gettin' Away).
There's a lot to explore out here, and no monsters yet, so take your time with it. You might start by bearing right- there's a lock pick in the narrow vase here, and a planter urn with an antique coin in the shrubbery by the steps.
Root through the rest of undergrowth and debris out here for some lootables, and a few locks and puzzles you can't complete yet. Make special note of the corrugated metal patchwork between the sets of steps.
These sheets can be pried away with your bare hands, to reveal a small crawlspace with an encrated Gun Repair Kit- one of the game's more valuable items, and one that'll be extremely handy in a second. When you've combed the outer environs to your heart's content (or you're just out of inventory space), enter the trailer (you may remember seeing this one from the balcony outside the Rec Room earlier).
The trailer is a safe room, so offload your excess inventory, then take a look around. There's a ton of good stuff, including your first chance to spend some of those antique coins you've been collecting.
The magnum is tempting, but there's another handgun upgrade that comes for free. Pick up the broken pistol from Zoe's bed and combine it with your newly found Repair Kit to craft the M19 Hangun- the same type you used briefly in the Guest House. Rifle through the rest of Zoe's things, then head for the door. The phone will ring, and Zoe will give you your next objective- find a serum in the Old House by the swamp. Sounds cozy. You won't be back for a bit, so shed your excess gear, including the shotgun. I know it runs counter to everything you've ever known, but you won't be needing it for a while, and you'll want some i-space clear for another bulky weapon. Something a little less Ash and little more Ripley. When ready, head down the garden path to the Old House.