Here are two quotes from Stephen Zepp (Garagegames Employee) about the video:

 Quote:

As Michael mentioned, this was an early version of a demo that was shown at GDC. We do have plans for the demo, so stay tuned!

If I recall correctly, that demo was done with "old school" TGEA (probably 1.03, with some customs mods), and doesn't really even show the power of TGEA 1.7 as it stands \:\)


 Quote:

Honestly, we're not -quite- ready to talk about it yet as far as I am aware. I've nudged our team to see what they want to do, but it may be a few weeks while we continue to work on the demo.