I'm really late to the party on this one and was originally intending to just stay out of it. After the Bundle for Ukraine (which did not feature Hayseed Knight), I have a bit of a perspective on this beyond "there's other demos and even browser only games in the Palestine Aid Bundle."
If you're not familiar with the Bundle for Ukraine, everything in it was supposed to be paid games only - no free games, no name your own price games, no demos unless bundle purchasers were getting the full game. There's been at least one developer that joined this bundle that has since switched their previously free game that went paid onlyback to being free / name your own price... meaning they blatantly changed their pricing structure just to get into the bundle and use it for publicity, which is completely dishonest.
Now as far as the Palestine Aid bundle, there's been a couple of demos in it. Repurpose, Solace State, Alisa | The Awakening, and Advent NEON are all part of this bundle as just demos. If there is a difference, it is only in that they put DEMO in the title.
However if you look at Monstrata Fracture, which is also part of the Palestine Aid Bundle, this game is still in development. If you spend $1 or more, you'll get an add-on to have NPCs wear glasses. The game hasn't been updated since October 31, 2020 and the only way to get process updates on where they are at in development is to go to their Patreon account to give them money every month. This makes the inclusion of this game in the bundle feel like a huge advert for their Patreon account, especially after having played it and finding that you don't get very far into it before things end abruptly on a cliffhanger.
It may have been nice to have the word Demo somewhere in the title. However since the developer does not plan to have this as a Steam exclusive, they're not going to want to do that. They'll want to update the page so that there is the free demo and the paid version all at the same place.
Also I don't see anything disingenuous going on here, like sneaking free games into a paid games only bundle or joining a bundle to promote your Patreon account, as The Hayseed Knight's developer has done neither of these things.