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Capcom originally had very different plans for the Bedroom sequence from the first Resident Evil 7: Banned Footage Vol. 1 DLC campaign that recently launched for the first-person horror game. According to the game's director, they were going to make it even more like a Stephen King novel than what it was.
Much like in Stephen King's novel where a crazy fan captures her favorite author and tortures him to finish writing the book, Marguerite from Resident Evil 7 was set to do the same thing to the player-character.
Nevertheless, in the Banned Footage Bedroom DLC the player was not in control of the typical main character Ethan, they instead were put into the shows of the camera man from the demo footage. The objective sees players attempting to escape from the bedroom where the cameraman is being held captive, all without ending up on the wrong side of Marguerite.
The tiny little room is filled with puzzles and secrets, and players have to spend time examining the room and keeping everything in place to avoid being punished by Marguerite. I can easily see how the whole novel aspect would have fit into the game, because it likely would have replaced her constantly trying to feed the camera the disgusting looking soup and meal. The only problem is that a cameraman writing a novel wouldn't have made much sense, unless it was an ongoing project involving the other captives who were previously held at the Baker's estate.
Much like the novel (and movie) of Misery, players would have had to go through the Resident Evil 7 mini-game of choosing the right lines to make Marguerite happy and buy some time in order to explore the room and make an escape. Nakanishi notes that they ended up scrapping the whole concept because they found out it was too complicated to implement.
Technically, I don't think it would have been too difficult to implement in the main Resident Evil 7 game, just too difficult to implement for a small piece of DLC. It's essentially a series of if/else functions based around the novella concept: if the player makes the right choice Marguerite leaves the room; if the player makes the wrong choice they're punished.
However, that would mean someone would have to write out large chunks of the novel and the different parts players could choose from to add to the novel. There would have to be different reactions from Marguerite for each section that was wrong and a different reaction for each section that was right, which would mean more work for the animators, more voice acting and more script work for programmers. It could have been doable, but Nakanishi is right that it would have been complicated for a piece of DLC that was only an hour or so long in length.
Even still, there's plenty of nods in the Resident Evil 7 DLC toward Stephen King, and it's not hard to see the influence from Misery. Had the novel concept made it into the game, it just would have made the reference that much more obvious.