This happened to my best friend last night and pointed me to this link when he did some research. Just passing it along.
Originally posted by ArticleUnfortunately, gamers eager to sample the cel-shaded beat-'em-up were in for a very nasty surprise. That's because the demo contained a glitch that will erase all saved games on the memory card or cards currently inserted in the console.
I pre-ordered the game from BestBuy online (to get the Nariko costume) and got both the game and promo card in the mail on the 22nd. Both the promo and network stuff don't work yet though (come back as invalid or can't connect)