Well, then they should have put a trailer in the demo showing some gameplay. From the demo, all one can deduce is that u can paint in it.
Or maybe you should just use your eyes (or perhaps memory) a little better. The start-up menu, where you choose the option to freely paint has a few other options in there as well that are 'unavailable in the demo' that should clearly give this away.
As for Eyecreate, why don't they bundle it with the camera? not everybody has net on his ps3, and anyways theres nothing to guide me regarding the camera.
EyeCreate was released after the PS Eye so for most people it was available as download only always anyway. I agree they could have put it on the Move demo disc, but I can understand they just didn't bother to get a disc version of this.