Clear the Rebirth Ending to get the DOG Key in the Doghouse near Jack's Inn in Southvale Silent Hill.
To get the Chain Saw easier, complete the game under the easy difficulty and easy riddle difficulty settings. Get the "leaving" ending (where he leaves the town with the girl). The Chain Saw will be located in the section just after the first graveyard. You will hear it, and it will be sawing away on some logs.
As in the PlayStation 2 version of the game, beat the game ''Letter from Silent Heaven'' with all 5 endings on one save and the blurry signs around town are now clear.
To get the chainsaw beat the Main Scenario and then beat the Sub-Scenario. Then start another new game and go down the path and you should hear a weird noise (not the one to scare you) then across form Silent Hill Ranch the is there chainsaw on the logs.