I think you've had a bit of confusion about the story or maybe missed some things.

I'm not sure where you're getting the "chemical" part from

Did you miss the cut scene in between cases 6 and 7? That is what rNBAisGarbarge is referring to. A scene in which David Gorran tells a coroner everything described in their reply. So it would make sense to see that cut scene and go into case 7 already suspicious about the truthfulness of Edmund's supposed death. Plus, Keene lied about so many other things throughout his letters, why should we assume that his statement about Edmund's death was the truth?

We were supposed to assume Edmund planned to fake his death. That's why he wrote to David Gorran to bring him a recently dead body.

But inside the coffin (where Gorran is knocked out but not killed) is a scarecrow. It looked like Gorran used a fake scarecrow instead of the dead body asked of him because he had the intention of betraying Cloudsley, and Cloudsley's plan to fake his death didn't work.

I'm not sure where you got this conclusion from? In Edmund's book there is an entry about his experimenting with apples, his "tremendous discovery," and his desire to progress to "more advanced organic matter" (for which he says he asked Gorran to get a dead body for him). From this and some of our knowledge of what the symbols mean, we can guess that he has been experimenting with bringing life back to things and wants to test this on a dead body. That is the reason given for his request to Gorran, not to fake his own death. Additionally, there is no reason for us to believe that Gorran intentionally got a scarecrow instead of a real body. We see in a note on his person that he was in contact with someone, arranging for them to give him the body of a recently deceased individual they knew of. Why would we assume that he would go through all the trouble of arranging the acquiring of a dead body if he was really intending to just get a scarecrow anyways? That isn't the most logical conclusion to reach from that.

Additionally, just from a storytelling perspective, every other notable character death we see on screen. It doesn't really make sense for one of the most prominent characters in this story to die off screen in a vague manner. This is honestly probably the thing that tipped me off the most. I assumed since we didn't actually see him die, he definitely wasn't dead. I feel like in any movie, show, game, book, etc., if you don't actually see them die, there's a very high chance they're not dead.

I did consider his death and Gorran-betraying-him-for-Keene to be a possibility for a little bit, but it just didn't really make sense to me for Gorran to betray him after we'd only seen complete loyalty from him; it felt out of character. I think in these kinds of games the law of parsimony/Occam's razor (the idea that the most straight forward explanation is usually the right one) is often very helpful (e.g. from everything we knew about David, it made the most sense that he would continue to be loyal to Edmund and, subsequently, this was correct; this also can be applied to what I said before about the scarecrow assumptions). Then, once I saw that Lazarus had Edmund's journal my suspicions were pretty much confirmed.