Rumor Reporter gives an update about rumors concerning Killzone, the none-appearance at GDC, and the alleged demo.
The article should be taken with a grin of salt, as the sources are a bit thin to say the least, so read with that in mind.
From the article : "I found out a little bit more than what I'm able to say, but posting anything more may not be needed. From what I know, Killzone 2 could very well be the best looking console game, ever. Period. This was revealed to my by a Genji 2 producer back in September, citing the game's visuals as even better than the original trailer."