True it is shown that it is pre-rendered but take alook at
this
The PlayStation Meeting Gundam demo is the first example of a fully
playable PS3 demo (that is, a demo where you actually control a
character), even though we ourselves didn't get to play it.
Expectedly, the game is a bit early in its development cycle. After
entering the game from the title screen, the player, who played
using a Dual Shock 2 controller, was able to move his Mobile Suit
around and shoot. Towards the end of the demo, an enemy came out
and destroyed the player's partner Mobile Suit. The player was then
able to blast the enemy, bringing an end to the demo.
There isn't much life in the game world at this point, and with
good reason. The demo doesn't use any physical calculations. Such
calculations, which will add effects such as wind and smoke, will
make use of the Cell's seven SPU processing units. The game in its
current form uses just the main Cell processor (minus the SPUs) and
the system's graphics chip.
Bandai pointed out that developer Beck created the demo from
scratch, without the use of middleware. It's unclear if Beck hopes
to continue along this fully independent development path, or if
some of the powerful PS3 middleware tools will be incorporated in
the final rev of the game.
You can take a look at the early demo for yourself through the two
videos that we've uploaded. Once Bandai and Beck have added more
life to the world, the PS3 may end up with an impressive take on
the Gundam franchise.
quoted from IGN
http://ps3.ign.com/articles/635/635525p1.html
take a look at the video of the demo and u will see.. 
