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Yes, there has been a demo turn into a #1 hit. last year Heartland's song "I Loved Her First" was #1 on the country charts. The song everyone heard on the radio was the actual demo. However, all the players were on the demo session were the actual band members of Heartland. So, there were no contract issues. this is from Walt Aldridge...who cowrote the song and produced the demo.
That technically answers your question; but I know that that is not what you were really getting at. I do not know the answer to the real question you were intending to ask in your reply.
Not much help. But, it is a real answer to your question, as stated.
Guido? No...but Guido knows attorneys who do his dirty work. They're even nastier than him, sometimes!
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"Do not endeavor to be the smartest kid in a dumb class. Instead, you are better off being the dumbest kid in the smartest class, where you will be challenged and you will learn. If you aren't growing, you are dying." -Brian Austin Whitney