So I'm currently 22 hours in and just beat my 13th demon, the Storm King (only have 5-2, 5-3 and 1-4 left), and I'm not really seeing why this game garnered a reputation for being the most challenging 3D action-adventure ever. I've been playing through the entire game in Offline Mode (can't be bothered to stick an ethernet cable into my PS3), so I've had very little outside help (only consulted the Demon's Souls wiki for weapon charts and whatnot), and I haven't had much difficulty with the game at all. I'm not gonna say it's easy -- it definitely requires some effort to get through -- but so does Resident Evil 4 on Normal Mode (a game very similar to Demon's Souls IMO -- very slow-paced, methodical, has the same suffocating atmosphere, and also does a great job of instilling fear in the player).
 
So what makes this game so hard for you guys? Did you all play the game as pure warriors? Because I'll admit, if I didn't have a high MAG stat and 3 spell slots, I would've had a lot more trouble with the game. Not to mention how I just traded in the Storm King's Soul for Second Chance, so this game should be cakewalk from here on out.
 
Here's my personal "Battle Mage" build for those interested:
 

Honestly, I think a lot of the difficulty is in the fact that if you don't look at any kind of online help it can be hard because the game itself isn't very forthcoming with information. It's kind of an old school JRPG sort of situation where if you know where everything is or you're using a walkthrough it's pretty easy but otherwise there's a lot of banging your head against the wall to figure things out. I played straight up melee for the most part and didn't have too much trouble at all except on Maneater, mostly because I read online about the awesome items in 1-1 and what weapons to forge and stuff.

As long as you're patient and attentive, the game isn't very hard at all. Problem is, most people are used to games that both allow and encourage you to go in guns blazing with your flashiest moves, winning purely on reflex, so that's what they try to do. And when they die, they do it again, and again, and again, without realizing that Demon's Souls isn't a game about lightning-fast reflexes and flashy moves, but about being slow and methodical and playing it safe. And then they give up, and declare it hardest game ever.

It's the Dead Rising 2 thing.
 
It offers a completely different experience, but gamers are people who start whining when the shoot button in their FPS games is moved to a different trigger. 
They played it with the logic of other games, failed, and hated Demon's Souls.
 
Play it like the game wants you to, and it's really not that hard at all.

Said it before, saying it again, play smart, cautious, make very few "mistakes" game is not that bad.  Play fast, loose, treat it like it is Diablo?  I hope you like watching the "you died" screen pop up.  Demon's Souls is NOT hard, it is simply fair.

I was kind of hoping for a hard game when I bought it but in truth I only found it difficult IF you're not patient or attentive about the way it's structured. I won't deny that it's tough and pretty brutal at times (Read: False King Allant) but again, be patient, pay attention and you'll get through it fine. While it wasn't as hard as I hoped it to be, I still really enjoyed it.

It's not that hard really. Like others have already said, it depends a little on how you play it, though. If you're a little more cautious than you'd normally be in videogames you will really not have that big of a problem with it, depending on the character build you're using. 
That being said, I played a knight on my first run and a mage on the second, and I have to say that Demon's Souls in general, and most of the bosses in particular are way easier if you're playing a mage.

Royalty is the easiest class to start with BTW 
 
I started as a knight with no outside help (no internet) and managed to beat it without much problems. The first 4 hours were brutal though.

Not so much "difficult" as "unforgiving." It's less Super Meat Boy and more "Did you take one wrong step while walking on this elevated catwalk? You're falling 20 feet to your instant death. Did you walk through that doorway without first pausing for around 10-20 seconds? Well here comes a dragon out of the sky to roast your ass for another instant death. Did you go to a certain stage before powering up more (even though there's no real stage 'progression'? Well the enemies here are way too strong, so you'll be almost instantly killed and good luck getting your souls back." It's a game of heavy trial and error if you're not using a walkthrough, and that can get extremely frustrating. 
My main complaint is the amount of people who talk about losing all your xp if you die. They don't seem to realize if you find your bloodstain, without dying AGAIN, of course, then you get it all back. In before the little elitists start talking about "dumbed down" games making everyone more stupid than them.

It's hard in the sense that the more you die, the harder it gets. That alone is punishing but as long as you take your time and play smart, it's a good, challenging adventure game.