People complaining about the sound quality should be aware that the versions I've watched had excellent sound with no issues. So there must be a dodgy version going around. And it would make a huge difference because the sound design is exceptional.
For best effect, watch alone in the dark late at night, and beware reading any spoilers. Leave your phone in another room. This movie demands more of your attention than most horror fare, but richly rewards that attention.
Although it has to be said that it does seem to be a polarising movie. Some people find it boring while others (like me) find it so chilling they sleep with the lights on for a few nights. I don't know what creates that difference -- personal taste, personal fears or maybe personality traits (openness on the Big 5 maybe)? But I've heard people say they watched it with the wrong expectations and the wrong setting and were unimpressed, then gave it a second try with more appropriate setting and attitude and had a completely different experience.
So expect a slow-burn mockumentary which lowers you into dread slowly but surely over the run-time, with a few horrifying lurches towards the end. Don't expect traditional jump-scares or ghastly effects. This is a movie that used my imagination against me in a way cgi could never equal. And it stayed on my mind long after the credits rolled. I think I immediately rewatched it, actually. It hits on some very universal topics and fears like grief, loss, alienation, isolation and the inevitability of death. So expect an emotional experience. This movie is at least as sad as it is scary.
I don't want to say too much more because I think it's best to know as little about it going in as possible. The movie benefits from having the freedom to guide you where it wants to take you at its own pace, without the resistance of expectations. I knew nothing about it when I watched it beyond what was written on the cover, and that seems to be common to many of the people most affected by it from what I've heard.
On a different note I really hope the writer/director Joel Anderson makes another movie. This has to be one of the greatest debuts of all time, and to not make another movie would be a terrible shame. I read that the budget was something in the order of $1 million and it only got something like $30,000 on release. Which is a pretty disastrous return, despite the positive critic reviews. The release seems to have been bungled for whatever reason. So I imagine that could've created some intensely unpleasant experiences for him as director AND writer. But it's slowly being discovered and appreciated by a wider audience after years of being kept alive by word of mouth between only the most devoted horror fans. I hope the revenue from its rediscovery is going to the creators and backers, and not some other company who picked it up for a pittance. And I hope the growing appreciation for Lake Mungo can lure Anderson out of the shadows and behind the camera again.