Here are my impressions, after nearly three hours of playing the demo.
The game is beautiful. It's so colorful, crisp and clear (I'm using component cables, btw). The animation is superb as well. This is probably old news to some, but the game just looks so sharp in person, moreso to me than the movies and screenshots previously conveyed.
Two options are open to you on the demo: Story Mode and Battle Mode. Story mode consists of two characters on one of the game's small quests, and when finished the game rewards you with this: "Well done! Did you enjoy our little adventure? The dev team is currently raising their tension in a bid to win the release date battle! The quest begins...November, 2005."
Battle Mode, on the other hand, lets you play the game with four somewhat-leveled up characters, running around in a rather large area experimenting with spells, skills, etc. I didn't really play it much.
Great news for series fans: The sound effects/music jingles are intact! Staying overnight at the inn, leveling up, battle victory, reviving a fallen comrade, finding an item, all there. Although minor, the text sounds are the same as well (advancing text in the window, moving to a new frame of text). I for one was glad to see all those in place. The new menu screen is also really well done. I don't mind at all the exclusion of the transparent overlays from previous games.
As others said, the voice acting can be pretty bad at times.
even has somewhat of an Australian accent. :/ The music, to me, is somewhat lacking. Some tunes sound pretty good (the first cavern tune in the demo greatly harkens back to the very first Dragon Quest/Warrior) while others are pretty forgettable, at least for now.
Like in Dragon Warrior VII, you can still pick up and smash vases and barrels, look in drawers, and look in bags hanging on walls for hidden items. Dialogue seems to be very well written so far, the series trademark humor is intact as far as I can tell.
As Scarlet said before, the game does tend to play more like the old Dragon Quest games, at least that's the vibe I'm getting so far. It's a bit of a shock to be playing a Dragon Quest game in full 3D, but very cool at the same time. In short, can't wait until the final version comes around, in the meantime if you're at all interested get this demo, it's a great preview of what's to come.