If there's anyone in Bloodborne that we can safely ascribe the quality of 'bad guy' to, it's probably Micolash. The Great Ones are too complex and too alien in their existence to ascribe moral values of 'good' or 'bad' to them; Willem very likely tried his hardest to prevent the events of Bloodborne from occurring in the first place; the Beasts are no longer thinking creatures; Yharnam is portrayed as being a tragic figure the victim of circumstances beyond her control; Annalise defied the Church and tried to steer her people into a new age of prosperity; Laurence and Gehrman's tried to control the Scourge; Ludwig tried to establish an organization that would protect the innocent; Eileen only kills Hunters who have succumbed to bloodlust; the Abhorrent Beast can't help the fact that he's been so horribly afflicted with the Scourge and his dialogue is almost heart-wrenching as you see how terrible his condition is; Maria genuinely cared for the patients of the Research Hall and was wracked with guilt at her actions in the Hamlet; Patches is mischievous but amicable; the False Iosefka is desperately trying to finish research which she believes will uplift and save humanity; Alfred simply wants to let Logarius rest in peace; Djura just wants to protect Old Yharnam; Gascoigne is slaying what he believes are monsters. Micolash on the other hand is batshit crazy, and he seems to be perfectly happy with that fact.
Micolash's existence seems to be, in itself, a laugh at the player by the developers. We've journeyed so far, faced so much, and struggled so painfully in our search for answers. When we finally encounter someone who could explain to us what the hell is going on, he's stark-raving mad. It's almost as if the developers are taunting us: "You're sure you want the answers? He knows the truth; look what good it did him." But before we get to Micolash's status as being Host of the Nightmare and the implications that holds, let's go back the beginning and take a look at Micolash and his School of Mensis.
Everything started at Byrgenwerth. A group of Scholars discovered existence of the Great Ones and the incredible power of the Old Blood. This would lead to an inevitable separation as differences in ideology led to a group of the Byrgenwerth Scholars leaving the Academy to found the Healing Church. Micolash was one such scholar. In our fight against him we see Micolash wearing the tattered uniform of a Byrgenwerth Scholar. The description of the Student's Uniform reads: "Uniform of the students of Byrgenwerth, a bygone institute of learning. The Healing Church has its roots in Byrgenwerth, and naturally borrows heavily from its uniform design. The focus not on knowledge, or thought, but on pure pretension would surely bring Master Willem to despair, if only he knew."
In the early days of the Healing Church the group operated mostly in secret. Gehrman's Workshop would serve as a secret police force for the Church, while Micolash would found the School of Mensis, a new institution of learning for the Church to continue the research at Byrgenwerth. According to the Upper Cathedral Key: "The upper echelons of the Healing Church are formed by the School of Mensis, based in the Unseen Village, and the Choir occupying the Upper Cathedral Ward." This key is found in Yahar'gul on the corpse of an imprisoned Choir member. From their new, secret location in Yahar'gul, Micolash's new School of Mensis would be protected and hidden by the Healing Church. The Yahar'gul attire tells us: "The hunters of Yahar'gul answer to the village's founders, the School of Mensis. Hunters in name only, these kidnappers blend into the night wearing this attire." From their hidden conclave, servants of the School of Mensis would skulk out into the night and kidnap innocents to drag them back to Yahar'gul for their experiments. The PC Hunter can be one such kidnapped victim if they die to a Kidnapper, an enemy that first make their appearance after the death of the Bloodstarved Beast. The Hunter also encounters and fights two Yahar'gul hunters lurking outside of a home in the Cathedral Ward, possibly searching for more victims. It would seem, however, that the School of Mensis slowly drifted apart from the Healing Church. While Yharnamites venerate the Old Blood and pay homage to the Great Ones as being god-like figures, the citizens of Yahar'gul worship the Great Ones directly. Statues of the twisted figures line the streets and enormous Chapels are devoted to the worship of spider-like Great Ones.
The Blood Moon
The rituals of the School of Mensis seem to be either directly or indirectly responsible for the coming of the Blood Moon.
Madmen toil surreptitiously in rituals to beckon the moon. Uncover their secrets. -Note left by a dead Hunter.
The Mensis ritual must be stopped, lest we all become beasts. -Note left by a dead Hunter.
When the red moon hangs low, the line between man and beast is blurred. -Note found in Byrgenwerth Mansion.
The red moon hangs low, and beasts rule the streets. -Note left by Djura.
Behold! A Paleblood sky! -Unknown author.
The Player first encounters the Blood Moon after the death of Rom, the Vacuous Spider. The PC Hunter discovers Queen Yharnam at the bottom of the Moonside Lake, seemingly having appeared from nowhere. She weeps as she stares at the sky, and as the Hunter follows her gaze they see the overwhelming Blood Moon looming above them. After that, everything changes. This is the moment when Bloodborne goes from being a tale of Beasts and Blood to a tale of horrible, eldritch things that work behind the scenes. Or perhaps a better way to explain it would be that it was always a story of eldritch things, only we couldn't see them. Many players walk out of Oedon Chapel for the first time to the sound of a loud, hissing vacuum-like noise coming from behind them. They turn and stare at the peculiar wisp of air that seems to flow through the air. Some of them, as I did, walk closer to learn more. It is then that the Hunter is hoisted into the air by unseen forces, crushed to death and succumbing to Frenzy. If you're like me, you moved on with the hunt. You chalked it up to just another bullshit Miyazaki deathtrap. What killed you was an Amygdala, or at least what I will refer to as an Amygdala. It's not clear if the Amygdala that serves as the boss of the Nightmare Frontier is the Great One's name or is its species. However the Amygdalan Arm labels it as an “arm of a small Amygdala Great One”, and the term Great One is too broad, and so I refer to these creatures as the Amygdalae. Once the Hunter slays Rom and the Blood Moon rises, the Amygdalae are no longer hidden; in fact it becomes painfully clear that they've been there all along.
Towards the middle of Lovecraft's career we have what Lovecraft Scholars refer to as The Dream Cycle.
For Lovecraft, the act of dreaming was a method in which human beings could briefly transport their consciousness to an alternate dimension. The Dreamlands are not an illusion, they are a real place. The Dreamlands are a location just like Yharnam, Byrgenwerth, Cainhurst, or Yahar'gul. The mere fact that the player can take items from The Dreamlands and bring them back to the Waking World is proof that it's a place equally real. The Lead Elixir's description states: "Its recipe for this mysterious concoction is unknown, but some postulate that it materializes only within the most desperate nightmare."
There are four distinctly different locations in the Dreamlands that the PC Hunter travels to: The Nightmare Frontier, the Lecture Hall, the Hunter’s Nightmare, and the Hunter's Dream. The Hunter's Dream is the first place in the Dreamlands the Hunter travels to, and from here it is where they will travel to different parts of the game's world. The Lecture Hall is the next location the Hunter travels to. The Lecture Hall of Byrgenwerth has been somehow warped and transported into the Dreamlands. The Lecture Hall is connected to the Nightmare, which consists of both the Nightmare of Mensis and the Nightmare Frontier, and judging from the fact that a Church Giant is found in the upper levels it’s possible that the School of Mensis moved into the Nightmare Lecture Hall at some point in time. Notice that when the Hunter opens certain doors in The Lecture Hall and transports to The Nightmare, the same warping effects and particles occur as when the Hunter uses a lamp. The Dreamlands are a location that exists parallel to our own world. They have a landscape just like we do, only they play by slightly different rules. Teleportation is just another method of transportation in the Dreamlands. The Dreamlands exist directly parallel to our own Waking World. While the Waking World is the domain of humanity, the Dreamlands are the lands of the Great Ones. These two worlds exist like a reflection of one another.
The Nightmare Frontier appears to be a reflection of the ravaged Pthumerian land of Loran, as evidenced by the fact that Silverbeasts wander the Frontier and that Amygdala drops the Ailing Loran Chalice. The Hunter’s Nightmare appears to be a reflection of the city of Yharnam itself. The Hunter's Dream is obviously Gehrman's abandoned Workshop. They are places so very similar to their locations in the Waking World, only slightly different.
Consider staring into the mirror, watching your reflection. You stare at it for an hour and, for the very briefest of moments, you see a figure standing behind you in your reflection. Whipping your head behind you, startled, you see that nothing is there. Looking back at your reflection, the figure is gone. What you've just seen is a tiny little rip in the veil that separates the two worlds, the Waking World and the Dreamlands. The figure is, of course, still standing behind you. It exists on a plane of reality parallel to your own, above yours. Maybe the figure was curious about you, wanted to learn more, and in showing interest made itself visible for just the slightest of moments.
"Behold! A Paleblood sky!" This message can be found prior to Rom's death, rather confusingly. If we look up at the sky, nothing is out of the ordinary. The message is still there, however, after Rom's death. Looking at the sky reveals the Blood Moon in all its splendor. Of course the message was there before, because the Blood Moon was always there, we just couldn't see it.
This is what insight allows us to do. With forty insight the Hunter will be able to see the Amygdalae in the Cathedral Ward even before the death of Rom. With fifty insight, the theme music of the Hunter's Dream will change to the theme that plays in the Hunter's Dream after Rom's death even before Rom's death. With sixty insight the Hunter will be able to hear the crying baby when standing next to Arianna, even before the death of Rom. There is a theme here. Insight allows us to glimpse into the realm parallel to our own and see what lies beyond humanity's perception. After the death of Rom, the veil that separates the worlds collapses completely. Insight is no longer necessary; the Blood Moon rises; the Amygdalae are visible; the crying baby is heard constantly. The citizens of Yharnam are driven insane once they are forcibly made to understand the depths of their reality. Simply looking upon the Great Ones is enough to drive someone insane, let alone the twisted knowledge that they lurked above you all your life, always watching you.