Bands often use the term 'demo' to describe what they're looking to do. "We want to record a 4 song demo." The thing is, though, that 'demo' is an inaccurate term, that leads to an attitude of tolerance for sloppy playing, poor instrument preparedness, etc. 'Demos' do exist, but really, a 'demo' is a simple recording of a song, for the purpose of demonstrating it to another musician, or a lyricist. Basically, for another member of the creative team, not a fan or other listener.
Anytime you are recording a song for public release, even if you're planning only to give it to a few friends initially, you should think of it as an album or EP. Your fans will be listening to it as if it were, and if it is well received, you may end up pressing hundreds or thousands of copies.
So, what is the difference between a 'demo' and a proper release? For one thing, a demo has no artwork. Thinking about your packaging and artwork while planning for recording can help you get the idea of a release more firmly in your mind. Don't worry about impressing record labels or radio people, worry about impressing your fans. If you can make them happy, everyone else will fall into line.
A demo usually has only one song (if it's a proper demo), or possibly a few, if it's being used to show a new bass player the songs, or what have you. An album is generally about 10-14 songs, an EP 4-6.
An album will have a proper flow to it. Start to think about sequencing early on. You don't want to get married to anything yet, but just have an idea. This will help you to visualize the end product. Think about the contrasts between songs, the narrative flow, if there is one, and whether you want the album to follow the traditional sequence of shorter poppier songs up front, with the longer 'artier' tracks towards the end.
You can also start thinking about production. A great album will have some 'stunts', little things that make the listener notice what's going on. These could be as simple as an acoustic section of an otherwise electric song, using an unusual micing technique for a vocal line, a weird effect here or there. On Jawbreaker's "24 Hour Revenge Therapy" album, there's a long section at the end of 'Condition Oakland' with Jack Kerouac and Steve Allen mixed in. It catches the listener by surprise, and over time becomes one of the highlights of the record.
Think hard about things like this, and ideas you have. Take notes, listen to lots of music, with an ear to how the artists use the recording medium to keep things interesting and moving along. You might notice that the snare drum sounds distinctly different from track to track (Built To Spill's 'Perfect From Now On' is a good example.) You might notice that some songs sound close to the listener and others farther off (through the use of room mics and reverbs), or that a track moves away as it progresses.
Most importantly, have the attitude that this release is forever. While there is a chance that you'll re-record these same songs at some point, in my experience, that doesn't happen often. Put your all into the effort, and don't accept 'good enough'. Be open to happy accidents, weird sounds and interesting mistakes. But don't leave things that bother you, or that are just plain wrong.
I always take the attitude that this recording is for release, and that we should do our best to get it just right. Try to take on this attitude next time you record, I think you'll be glad you did.