The setting & environment really appealed to me as I love underwater sci-fi stuff. In particular the lighting (caustics and reflections from the water etc.) was top notch! There were a few visual bugs with character models clipping and enemy ragdolls glitching, but that didn't take away from the experience too much. I also really liked the surreal/otherworldly feeling to the ending and the pre-rendered backgrounds looked really nice.
What I would say is that the quick turn could be implemented a little better I think. Currently you hold down on the analogue stick and press the sprint button, similar to Resident Evil 4. However, since I hold down the sprint button all the time in these kind of games, I would end up accidentally quick turning when trying to back away from an enemy. I then would have to turn back around again which usually meant I wound up taking damage. Perhaps the A button could be used to initiate the quick turn instead of the X button.
Additionally, I think the gun sounds could be more impactful and the enemy death sounds more gruesome. Even though you want to deter the player from using their guns too much, I think having more intense & scary sounds when they do have to would still add to the tension and fear factor.
Overall though, a great classic-style survival horror game and I'm excited to see how the two parts of the demo will connect! 4/5