Ok, so demos are great to have. As a person in charge of hiring, what kind of demos would you like to see in a candidate? What kind of portfolio should a person without demos try to develop for the purpose of trying to get a job?

It depends on the job. I'm hiring web devs at the moment so cool functioning sites are great(but rare). I'm certain a few little games I wrote in javascript(blackjack, and copies of a few of the games from kde games) got me my first job in web development. The CTO loved the blackjack game in particular.

I guess the best advice would just be anything interesting that shows off your skills.