Unfortunately, I haven't read the Chetwynd-Hayes tale (I haven't find a not too expensive edition of the Monster Club - yet). But I enjoyed the episode on The Werewolf and the Vampire, especially the conversation about 'monsters as people'.
Like Scott Dorward, the guest on the show, as a kid I also wanted to read books that turned the bad-good principle upside down or let it 'gray' - by using humor, strangeness and/or eerie atmosphere. Most of the times I ended up with Brittish children's horror, though I've unfortunately forgotten which writers these collections of stories were written by. Later I became a huge fan of Neil Gaiman in whose books I recognized this typical Brittish style (nicely mixed with the American style of superheroes).
Actually, when I write horror/weird tales myself, I don't manage to get the monsters really scary, because I often see them as human anyway and feel sorry for them (or see them on par with the terror of humanity). As a result, I've started using things like terrifying dimensions for the horror effect, or strange events that shouldn't be possible - that works better for me (I owe a lot to reading Thomas Ligotti for that part).
I recently got 'The Ashgate Research Companion to Monsters and the Monstrous' in which I hope to find more answers to the questions regarding monsters versus humans. By the way, right now I am reading 'Monster, she wrote - The Women Who Pioneered Horror and Speculative Fiction', which won a Bram Stoker Award and a Locus Award for non fiction. It's a real nice and interesting read that seems to me to be an interesting access to more stories for Elder Sign as well.
Scott Dorward also made me curious about 'The Litany of Earth' by Ruthanna Emrys - I hope to read that one soon too. So, thanks for the inspiring episode!
Scott was awesome and I hope to get him back on the show again sometime.
When you're done with "Monster, She Wrote" (a great title!!!) let us know if there's a story or writer discussed there that you'd be interested in us covering.