There was no doubt, given the continuing economic collapse and all the joy that brings, that Demo09 was going to be a much tamped-down and sober affair this year.

But there are still a lot of interesting start-ups being featured in the main ballroom and demo “pit,” such as a cool “touch book” offering, a strange hooking-up-in-a-bar smartphone app and a plethora of ideas that obviously got their inspiration from the iPhone from Apple (AAPL).

As in: touch, swipe, interact! (Which is the official BoomTown motto, in point of fact.)

Demo Executive Producer Chris Shipley is still running the show. But VentureBeat founder and Editor-in-Chief Matt Marshall will take over the longtime, semiannual conference–where several dozen start-ups strut their stuff in front of an industry crowd–in 2010.

Here is the video I did of the event, which was held in Palm Desert, Calif., and ends today. It includes serial entrepreneur Mitch Kapor, PR guy Brian Solis and All Things Digital Co-Executive Editor Walt Mossberg.

I’ve been through the desert on a horse with no name/It felt good to be out of the rain/In the desert you can remember your name/’cause there ain’t no one for to give you no pain.

Actually, for Yahoo (YHOO), which is holding its big annual meeting of the company’s advertising sales staff in Indian Wells, Calif., maybe just a little pain since BoomTown is only a scant few miles away, as the crow flies, attending the Demo09 conference in Palm Desert.

Don’t worry, Yahoo PR, I will not crash the proceedings or be bribing the bartenders to get more leaks. But you Yahoos should still be careful with the wine in the hot tub anyway–as Carol says, loose lips sink ships!

The gathering–to which Yahoos were greeted at Palm Springs Airport by purple Yahoo-capped greeters and were ferried to the Marriott’s Renaissance Esmeralda Resort & Spa via limos, according to many Demo attendees who ran right into the phalanx–is being run by Yahoo sales head Joanne Bradford.

Bradford has the unenviable task of selling into the weak ad market and driving sales, despite a very troubled economy and a company trying to claw its way back to stability. And, of course, getting Yahoo’s much buffeted sales staff jazzed up to do so.

Bradford will be helped in inspiring Yahoo’s large sales staff with what is sure to be a cussing-good appearance by CEO Carol Bartz.

Just last week, Bartz announced a massive reorganization of the company’s management to streamline it and make decision-making quicker.

“She thinks it critical she be there to get the troops excited,” said a Yahoo in the know.

Ye-haw!

How much do I wish I were there to see that performance? Much! (Except for the part in which I would be thrown out on my keester by Bartz herself, despite my plan to disguise myself by wearing all the Yahoo swag I have collected over the years.)

Instead, I am riveted to the goings on here at Demo. Right now, for example, I am watching an it’s-always-darkest-before-the-dawn session with venture investors on the dire economic situation, and about to see a new “touch book” computer.

Video of that and more, of course, to come.

This past weekend, BoomTown revved up the Mini and headed out in the pouring rain to a Peet’s Coffee in Fremont, Calif., to the exact spot where Demo Executive Producer Chris Shipley proposed that VentureBeat founder and Editor-in-Chief Matt Marshall take over the longtime, semiannual conference where several dozen start-ups strut their stuff in front of an industry crowd.

Shipley will still be running the show at Demo09 starting Sunday in Palm Desert, as well as the next Demo in the fall, with Marshall working alongside until he takes over fully in 2010.

(Shipley will remain on the advisory board, but will mostly be focusing on her consulting firm, Guidewire Group. She has run Demo for 13 years.)

Shipley and Marshall talked about it all in a video interview, as well as the fake controversy ginned up last year by champion ginner-upper TechCrunch–which, big surprise, runs a competing conference–about Demo’s longtime (and transparent) practice of charging a large fee to presenters.

“It was a false argument created as a marketing tool by a competitor,” said Shipley flatly.

What will be more pertinent and interesting in the Marshall era will be the integration between his VentureBeat Web site and the IDG-owned Demo conference, which could be a good way to take the conference and make it a year-round community of interest.

“We want to turn from a five-day affair into an ongoing conversation 365 days a year,” said Marshall, who also said the Demo model still works well. “It’s not that broken, so we will be tweaking it more than fixing it.”

Here’s the video of the pair chit-chatting about it all (sorry about the coffeeshop noise, but it was very festive):