I've released the next version of the demo.
Notes
Fixes a problem with regions getting corrupted by an unremoved entity
Fixes the options menu so that the options actually affect the game (lol)
adds movement types to the characters
adds more actions (sneak, climb, etc)
adds swimming and water physics
improved particles, splash particles
water spreads. beware, probably slow and buggy
torches animate (no particles yet)
damage from falls
AC now adjusts (doesn't do anything yet) according to movement
adds some dodge/agility moves: sidestep (left or right twice) backflip (agile chars only - back twice) broadjump (double tap forward and jump)
Next I will fix light and add scoring and inventory. This will take removing blocks out of 'creative' mode and make it require the pick. Placing blocks will then become possible.
I may also add a foe.