Passing a device with your demo app around the audience is not enough, even for a small group of people:
  1. Screens are small and do not make a big impression
  2. People do not know what to do in order to see the best of the app
So the point of passing the device around is mainly to prove that your app exists. It should be supported by very large screen shots on the projector screen that tell the story behind the app, with the right sequence of features. Preferably with different levels of zoom: a user holding the device, the opening screen with the device around it, and then zooming even further to parts of the screen.