if you bothered reading the readme for UT2003 they said that the retail game with have textures that look 2x as good on average, the reason the demo doesn't have full quality is because they wanted to keep the file size down.
anyway, that much should be obvious since the highest quality settings available for Texture Detail is "normal." Character Detail also maxes out at "normal" so whether or not that means increased polys in the real version or just better textures is somewhat unclear.
edit: i would like to add that this is a deathmatch game, not a single player experience. the goal is to have the game run as fast as possible while looking nice. wait for Unreal 2 if you want nice graphics.