Those demoscene guys are probably some of the most impressive programmers I've ever seen. It's amazing the kind of visual displays they can produce with just 4kb or 64kb of code.
Here, what's impressive is the ability to render video full speed on something AS SLOW as the first 8088. Pretty cool.
You bet! Small demos on PC are seriously no feat anymore, since they have so many dependencies. I don't even bother looking at these kind of competitions anymore, as the size requirement has no meaning anymore. Big, fat demos are more interesting that that aspect: what can you do if you don't have any limits? ASD is one of the key players in that area.
https://www.youtube.com/watch?v=hhpN0vcHH9c
You can see the video itself around 6:30 in.
Friend of mine at the time had collected about four of the machines. Full-size disk drives are real beasts! Needless to say the project that never happened was to write a little program to control all four from a central PC by signalling over the unused serial pin or something... never happened, but would have been lots of fun.
Cool stuff and thanks for the link! :D