As much as Microsoft are probably being twats, Konami already know Microsoft are twats from last year (when I believe the exact same thing happened) and should have took that into consideration when getting it approved this year to make sure this demo rejection happened last week.
E.G. If I get in late to work because the schools have come back from their holidays, I don't leave the house at the exact same time the next day and just expect to be on time again, especially with money at stake.
If they did try to get it approved early and this is the second rejection then - to quote Keith Lemon - "fair do's".
Obviously there's the Tsunami issue which I've not mentioned because Konami haven't mentioned it.