Just finished the game. The story was muddier than I would have liked in the end, but here's what I got from it. Clearly, none of this is spoiler tagged.
Tom Zane was a writer in the 70s who moved to Bright Falls with his wife. His wife, his muse, cheated on him, and he succumbed to the darkness that was present in Bright Falls. When it tried to write itself free, using the form of his wife as a mouthpiece, he realised, and tried to destroy the darkness, or at least suppress it. When he worked out that the darkness made what he wrote manifest itself with form, bending reality, he decided to write himself out of history, with the exception of his shoebox and clicker. In his place, he wrote the young Alan Wake, a boy who grew up with Tom Zane's stories filling his life, taking the place of an actual reality. Alan met Alice, wrote books - presumably based on those Tom Zane had ideas for - and then, one day, ran out of the pre-created ideas that Tom Zane had written for the character. The writer's block was, essentially, Alan reaching the end of what Tom Zane had created for him.
So, the Wakes take a holiday in Bright Falls, and, as happens, history repeats itself. Alan is lured into a trap by Dr Hartman - who wants Alan in his clinic to further his career, to push his own profile and sell some books - but this only serves to confuse the matter of what is real and what isn't. Alan swiftly realises that the only way to fix what's happened - in that, he had accidentally and unintentionally begun to set the darkness free - is to rewrite it again. Not having a mind for plotting - as his ideas are gone - the best Alan can create is a facsimile of himself, the Mr Scratchy character, but he can free Alice. He writes Bright Falls into what he thinks it should be, an idyllic town where DeerFest happens, Tor and Odin dance around, and everybody knows everybody else. Alice is alive, and Alan writes that he died diving in to save her.
FIN.