I never played Silent Hill, I just know Dead Space had limited ammo, limited storage and was slow-paced and very scary. That seems like survival horror to me.
Silent Hill was pretty much the same. An added bonus to SH was your character played like the normal guy you're supposed to be, with no weapons or combat training which made the game even more tense. People disliked SH because of this, but I think it was a great part of the whole experience. If you have a PS2/Xbox/PS3/Xbox360, you should grab a copy of Silent Hill 2, it is one of my favourite games of all time. The story is really compelling and makes you care about all of the characters involved. The Xbox version is the better because of the extra content, by the way.
...While Dead Space did have a good atmosphere, once you got used to it, a lot of the game was spent simply mowing down necromorphs. With that in mind, what I've read of Dead Space 2 hints that they're keeping a similar mixture or action and horror. If they lean too much towards action though, I must agree, it won't be worth looking at.
A lot of horror games are like this, where they have a typical setup to the tense moments and you become acclimated to it. The initial experience is still worth it and helps you continue on with the story to see what happens next. I have to admit that even the third time I played through Dead Space, I still had that weird uneasy feeling, like when reading an H.P. Lovecraft story.
As far as the game focusing more on the action, it kind of makes sense in the sense of story progression. You have to remember that Isaac has already experienced these things now, so in effect he is used to fighting them. I'm still confident that they'll be able to shake things up with some new experiences in Dead Space 2. I just hope EA won't commoditize this series like they have a lot of other series (Bioware games, for one) and keep the game great.