Well I've just played the first demo, and here's my view of it.
My first comment will obviously be that it's very short. It only took me five minutes or so. And it doesn't show much in the way of features. However the briefness doesn't too much compromise the interesting idea.
Next demo will have much more
What I will say though is it seems to rush to the first town being occupied by Rockets. Perhaps build up a little more time with either just one Rocket outside the Pokémon Center at first or something. It's just a bit too sudden, you go downstairs straight away and there's the Rockets all over the town like a disease :P
Saffron City?
Although I do like it that Jesse and James rush you after you've received your first Pokémon. That'll be cool when the CBS is in place.
I was hoping you'd've put in the Starter Kit by now to make it look flashier and more like Pokémon. But never mind!
You've also got some passability problems, like I can walk over objects that should be impassable, or the bed which the covers of need to appear over the player.
I don't think that I'll be able to fix the covers.
I should be able to walk UNDER the top tile of a plant too.
Fixed
Also, there's a patch of grass just above the water in the first town that i should be able to walk over but it behaves like a solid object. That's kinda weird.
Fixed
There's also a glitch with the Jesse and James sprite, a weird coloured line of pixels appears to the right of them on one of the frames. Should be easy to fix.
Fixed
Right, next up, the mapping needs a lot of work. WAY too much open space, things are generally a little closer knit, and the first town needs to have trees all around the edge, which is lacking here. There's just general inconsistencies that make it look not like Pokémon style. Grass styles need to be more mixed too, you just have blocks of the same grass tile. Around halfway down my tileset there's a square block of 3x3 grass tiles which you can use the fill bucket with and it makes an instant appearance of variation. Try it! It's a good trick, and makes the grass less boring. Not a lot of people know that.
But mostly it's those wide open spaces you need to get rid of.
Yea, the first 2 cities will probably be like that, because they are already mapped, but the 3rd town will be like that.
Maybe have a few more people walking around the town as well.
Next demo
Positives are the idea of the flashback, which was really cool, confusing and mysterious. An intriguing plot device which I like a lot!
And the interesting method of getting your first Pokémon is sweet too. Just make the lab look better! :P
I'm going to support your ideas and concept, and I'll say it shows promise. It just needs executing in a tider, more polished manner. Keep it up! :)