Not to mention all the phones that were returned that had NO defects at all. Bought a phone and coulndn't afford the contract? Bought a phone and the wife told you to return it? Bought a phone and got impatient with the long activation times?Whats not to like? Its $100 cheaper, carries the same warranty as a new one, and it looks cosmetically new.
And think about it, how many people have bought brand new iPhones and had to return them for various/random defects? So buying new isn't guaranteeing its better in any way.
I would NEVER purchase a demo unit anything at a store. Hell, I hate to buy shoes that have already been tried on. But, Apple restores these to the identical condition as new and backs with the standard warranty.