[PS3] No playable FFXIII demo for us :(

In the demo, only one character is under your control in combat. The issue is that you will gain 1 point of time guage before you can choose Attack or Black magic (which you select makes no difference, anyway since you can combine skills from both in one combo o_0), choose your target, and choose a 1 point action. Choosing two actions will be close to the time to get 2 points of time; you have plenty of time to choose 3. Instead of letting you plan the next attack while the current one is in progress, you have to wait; moreover, the UI sits there and lets you choose attacks and stuff then discards it when the current attack completes.

Can you change the character you control (I'm thinking Party Leader type thing...)? And how do the other characters determine how to attack - is it like the gambit system in FFXII?

No, you control a fixed character. How the other characters determine what to do is unclear.

That seems rather... strange.

Unless Squenix have perfected buddy AI (or dumbed down the enemy AI), I can see big battles becoming very frustrating.

So you have no control over the actions of your other party members? That is odd...