I got to the driving portion of the demo, and I wasn't too impressed, but I didn't find it awful, either. The driving controls must have been greatly improved for the PS3 version, because I didn't find that the car handled too badly at all.
I finished the demo thinking that I would never buy this game. I then went to a forum for Alone in the Dark: Inferno to see what other people thought of the demo, and I was suprised that the majority of people thought it was good. After a few conversations on the forum, I decided to give the demo another shot. This time, I had a more enjoyable experience.
While I don't think the demo is good, I think it is decent. I think this game is probably going to be worth a play for survival horror enthusiasts, and I'll probably pick it up myself when it reaches the $29.99 price point.
The things I liked about the demo are the environments, the combine items mechanic, and the atmosphere. What I didn't like about the demo was the character facial animation, the dialogue, the clunky combat mechanics, the fire, and although I feel that the driving portion wasn't terrible, I didn't find it very enjoyable either. Overall, I don't think the demo was terrible, but I don't think it was very good, either.