On my NG++ right now, and since I haven't played this game in a while I'm all kinds of rusty, which means I've been dying *a lot*. Took me like 4-5 attempts to get past the Flamelurker, but that's also because I refused to cheese him even though he gave me a few openings to do so
I'm in 3-1 now, and those Kthulhu-esque magician lords are giving me nightmares. They've cost me about 100k in souls so far, and although it's often disheartening it never feels unfair, as every single time I die I simply *know* it happened because I became over-confident and rushed into things before thinking them through. The gameplay in this game is incredible, and regardless how good Dark Souls ends up being, I know that I'll often be replaying this game (along the few other Greats in our hobby) until I too have left this mortal realm.
Also, damn this game is beautiful in a dark, bleak and majestic way. What's great is that it never falls into the trap of feeling like other (mostly western) RPGs, that often look and feel like ripoffs/parodies of Lord of the Rings. Even the dragons (some of the most cliche and tired creatures in the genre) truly feel alive, deadly and majestic here, and create a sense of awe and respect. The only other games I can think of that have this kind of artistic coherency are Ico and Shadow of the Colossus (games that I often reference when talking about Demons Souls with my friends, as I consider them to be just as unique and important contributions to the medium as DS is).
I can rave about this game endlessly. If Dark Souls manages to surpass this, then we'll be looking at the best game of the last 10 years (which would naturally only bump Demons Souls down to second place then