In general the level design of the demo is really good! Wario's moveset gets utilized in plenty of ways, there are plenty of riches to find and the level structure is really interesting as well.
There are a few problems I have with the lineup of levels, though these will go into more of a nitpicky direction:
One thing that this demo does a lot worse then Wario Treasure Master is that the levels blend together a lot more. 3 out of 4 levels in this demo use a very brick-heavy theme, and while alley manages to stand apart fairly well despite of that, especially grotto and the tutorial level are very similar. Another thing that doesn't help is that the Sonic CD OST (specifically the US one, which is mostly used) is also just less varied than Wario Land Shake it music that was used in WTM. Additionally the level gimmicks are a bit less pronounced (which is in my opinion better than it was in WTM, those levels got pretty gimmicky fairly quickly). Trying to do some measures to make the levels more distinct from each other would really help the episode. Best way to do that would probably be adding more visual variety between the levels.
Not the biggest issue though, but still something worth considering
One thing that almost all levels in the demo suffer from is that sections that make you use the mach run are a bit too tight for their own good. Especially Sewers suffers from that, but also the tutorial level has it's fair share of areas where you have to do an overly precise jump or have uncomfortably little space to charge up the run (view gifs for that)
Also, some areas in Sewers are way too shrouded imo, especially when you return (and then again especially on the second lap). I get that it's for conveying the atmosphere of a wasteyard, but man it goes overboard in the misty areas.
Also something about Alley, the area with the red switch blocks is cool, but very annoying. For once does the post look like a bgo, making me crash into it way too often. Giving it a black outline or something would work well. More importantly though, doing a charged run and jumping to hit the blocks is really cool, but way too precise atm. Perhaps it would be better if there were two switch blocks next to each other rather than just one, especially since you have to do that twice, and once under time pressure.
I really like Grotto (probably be my favorite of the demo). There are still a few things I want to point out there: The boosters are a cool gimmick, however you don't get shot out boosting when you shoulderbash into it. Should be super easy to fix, just also add wariodashing.dash = false into the part where it shoots you off.
This section is neat in concept, but was it really necessary to have to hold into the correct direction when going through the correct pipe as well? That makes it overly cryptic.
Also since the water disappears when you return, I think it would be cool if there was a draining sound effect that plays when you hit the frog switch to put a bit of attention to that (I actively realized that like after I beat the level lol)
another super small thing is that the booster should also play a sound effect when it boosts you, but that's like super nitpicky xD