It's hard to pinpoint a single reason, but I walked away from the TGS demo impressed by how much better this sequel looked. It could be that the graphics have simply improved in the franchise's second outing on the PSP. The environment felt larger, and a bit more detailed, and other elements helped give the impression of a better looking game. The UI looks a bit sleeker, with helpful status icons appearing on the command map, highlighting characters with low HP, for example. Character portraits take much bigger prominence on the screen during the gameplay sequences and the manga-inspired cutscenes. The rich red hues and expressive portraits offer a visual "pop" that its predecessor lacked.
The gameplay in the TGS demo, for better or for worse, plays identically to VC2. There were no new classes to be discovered in the demo, nor were there any new enemy types. There doesn't seem to be an obvious "new" feature to VC3, unlike the multiple maps that were featured in VC2's TGS demo. Perhaps the demo is meant for those who are already familiar with the game's mechanics? The demo was a bit more challenging than last year's, featuring a large tank that had to be boarded and destroyed. Equipped with two turrets, it was effective in knocking out a few of my soldiers (oops!).
While it's a bit disappointing that the TGS demo didn't highlight any new gameplay mechanics, the overall experience was still satisfying. The improved graphics and presentation may suffice in appeasing fans. Considering the lengthy wait for the game at TGS, it seems as though Valkyria fandom is only getting stronger.