are the events themselves or the setting of the story contribute to the morbid feeling

Both contribute to the story's morbidity, but I think the setting enhances the feeling;

Haunted Mansion, Several Dark and Stormy Nights

(To be fair, this was probably less of a cliché when Poe wrote “Usher.”) Notice that we don’t know the geographical location nor a specific year when these events go down. The fact is, the mood and atmosphere in the setting is far more important than the facts of time and place. And it certainly is a powerful atmosphere that Poe creates. The outside of the mansion is the first of many spooky settings Poe renders in his tale. You’ve got an ethereal glowing cloud and a dark and scary lake, not to mention the ominous fissure running down the center of the mansion. He creates a different but equally scary setting inside the mansion, where the corridors, though filled with seemingly ordinary objects, seem to scream “YOU ARE IN A HORROR STORY.” The dank underground tomb is yet another of the masterfully-crafted mini-settings in “Usher,” one we actually recognize from the Roderick’s painting earlier in the text (make sure you check out “Symbols, Imagery, Allegory” for some juicy, painting-related thoughts).

The house itself is carefully crafted to heighten the mood and atmosphere of the story, like the creepy tapestries and furnishings inside. The fact that Usher hasn’t left the house in ages lends the tale a sense of claustrophobia. In fact, the narrator himself doesn’t leave until the story’s end – which makes us, the reader, feel just as trapped as Roderick. The house’s sentience is also a big deal – the physical setting of the story is as supernatural as its action and themes. Then there’s the fall of the house itself, which we discuss in “What’s Up With the Title?”