Lamberto Bava, son of Italian horror legend Mario Bava, definitely knows what he's doing behind the camera. I'm definitely a fan of Demons 1 and 2, but when it comes to Demons 3: The Ogre, here's what you need to know to enjoy it more:
This movie has nothing to do with Demons 1 and 2. In fact, the title of the movie is The Ogre or House of the Ogre which was its original title. Demons 3 got slapped onto the box art of the latest DVD release in the US in order to generate more sales through name recognition. Lamberto never intended it as a sequel. Booooo!
The Ogre was created as a made for TV movie. This means its a lot tamer than the usual "buckets of blood" Italian horror film. This is not a bad thing. You just have to go into viewing it with this in mind.
Where Bala excels in The Ogre is creating tons of atmosphere. In all the scenes where the actual creature is lurking about it's a total home run. The visuals are greatly enhanced by a simple but ominous musical theme that is repeated throughout each of these scenes. It helps to build a sense of dread every time.
The two things that prevent The Ogre from receiving a Very Good rating form me are it's length and the design of the creature itself. The Ogre would have been much stronger with a shorter run time of around 1 hour. There are far too many scenes that don't contribute much to the story. With regard to the creature, it's best when we only see a hand or part of his torso. When we finally see him in full form he looks more like a giant, slimy Ewok! The clothing choice is too cartoonish and would have been more effective with a more disheveled/degraded look. Hansel & Gretel outfits don't exactly work in creating a menacing monster.
So, definitely give this movie a chance is you like Italian Horror. It's strong points definitely outweigh its weak points.
For more info check out the film's entry in IMDB.