The disconnect between the screenshot and the live demo causes more confusion than anything else, in my experience. I’ve been asked many times why the demo doesn’t look like the screenshot. Is the theme broken? Is it still maintained?
Live demos play a critical role not only in the pre-sale stage but also post-sale. Users “buy” the theme because they liked the demo, and that’s exactly what they want. And when they struggle to re-create the demo, be it lack of demo content import or import isn’t working, it creates a lot of frustration and sometimes ends up in refunds. I’ve dealt with these issues many, MANY, times. A lot of frustrated users.
A lot of users when working with a theme refer to demos to see how to set something up or to see what’s available for a specific use case. Premium theme demos showcase everything, all the features, page templates, shortcodes, etc. So you can see what’s available and then figure out a way to re-create it on your website using that theme.
So bare-bones demos of themes are not as helpful as fully featured demos to regular users.
I think initially, the theme directory should ask developers to enter the theme demo URL in addition to a screenshot. This way CP doesn’t have to host any demo sites, while still giving users a way to see a demo.
For example, look at the Astra theme listing. Look at the screenshot and then look at the demo. It’s night and day. https://wordpress.org/themes/astra/