I think the answer is yes! It depends on what you mean by 'engaging'. This demo was designed to be very easy and to give a brief look at some of the core stuff. future demos and the game itself will have more balanced (and challenging) combat. You will also fight enemies in different situations that put you at diffrent strategic advantages or disadvantages. The game will also have inventory mangement and resources will be more scarce so you will need to think through your actions more...
We've also got some enemies not shown who fight in some interesting ways, the police have AI that works better in more cover-rich scenarios and the Skralla will have more behaviours for hiding and re-engaging. And of course you will actually get to fight Dr. Brian.
If by 'engaging' you mean jumping out of an airplane from 20,000 feet to glory kill a skeleton... then probably not! :^)
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Skunkape Interactive is a 4 man team forged in the swamps of Florida, with the focus of making surreal first person shooters.