I never played much of Demon's Souls, so I can't comment on that. Everyone I know that has played both enjoyed Dark Souls more, though. New Game+ is pretty much what you would expect. It's harder, but still doable. There hasn't been too many bugs that i've noticed, although there is an area (Blighttown) that gets a slight drop in framerate at times, but it's not too bad.
Dark Souls was my favorite game of 2011, though, so I might be a bit biased.