The items your character is carrying indeed show up with them in the morning- usually, in the closet, though I've seen at least one person have something in the desk instead... I'm not sure if... well, whatever. The only limitation to this I know of (or am remembering) is detailed here (http://damned-info.livejournal.com/1344.html), in that items taken from patients on special counseling are restricted to only one continuing to exist. If your character loses their flashlight or another item they had, it's gone unless someone else picked it up, so yes, Scarecrow will still have the extra. ^^

I think that's all right. :P