they rejected even a censored demo? urgh. how bigoted. i'm sorry.
well, i guess your game doesn't feature enough sniper guns or other lethal weapons, wandering undead corpses and/or skimpily dressed (read "half-naked") easy underage school girls - all the savory healthy things steam's younger customers really need to be regularly presented with to grow into mature, responsible, mentally balanced adults... or maybe it was lacking eerie erratic pixel clusters in very bright colors, just so we don't forget the humble start of computer graphics two centuries ago ;)