Let me first say that I like both LoL and HoN. I like them partially because they draw off a particular demographic of Demigod player that will never be happy with the kind of game we're looking to make.
On the risk of speaking for my friend Mike Marr at GPG, Demigod, as it is today, is the game we wanted. That's not saying it couldn't be improved (see my complaints on MP stats, lobby stuff, and item balancing) but those are things that can be addressed.
For me, that Demigod has 8 Demigods is a feature not a bug. There is NO way I would ever have supported there being dozens of Demigods. I would like to see more maps though and it's something we're going to try to get.
The game mechanics of Demigod are ideal IMO. My one request would be that flags give powers too (i.e. additional spells) and such but in the bigger scheme of things, it's not a huge thing.
But I don't see Demigod as being for the "casual" crowd.
As for the size of the MP community, I think a lot of people (I know a lot of people myself fall into this) they want Demigod v1.2 or at least v1.19.