There's a reason why demon souls isn't the best looking game, technically speaking. It's because the console isn't as powerful as what has been out/currently out/coming out for PC.
No, this isn't the reason. Its devs said they were going to add RT but at the end they didn't implemented it because they are a relatively small team for AAA games (under 100 people) and the game had to be ready for launch, so didn't have time to implement all the things they wanted to implement, and RT was one of them.
Spider-Man Miles Morales instead uses RT, and the tweet on the OP mentions it as a great example of RT reflections and wants to hear a tech talk about them. The Epic Games dev mentions that Direct X Raytracing (PC, Xbox) sucks because he'd prefer to have access to the low level stuff, something PS always provided (not only in PS5).
And these are only launch games (which always means rushed and developed whithout knowing the final specs during a big portion of their development process) developed in engines made for last gen. Once they start using engines designed for PS5 only taking advantage of all its new hardware stuff (geometry engine, super fast SSD+I/O, everything related to its memory management etc) the results will be insanely better as shown in the UE5 demo.
Once their engines will be designed to stream insanely detailed models and textures at super fast speed with geometry engine culling what they don't need and reducing their detail to what the resolution allows thanks to geometry virtualization and virtual texturing, they won't need to do many tricks they currently do like bump mapping, LOD, lightmaps, baked illumination and so on, and they won't even need to do the current shadows (including the RT ones) because ray traced global illumination will take care of that.
Tim Sweeney explained in Twitter why they like the PS5 and why this demo was running there instead of in a PC. Let me (and Tim Sweeney) know if you find a PC game looking better than this demo. Or to the Rendering Engineer at Epic Games of the tweet that appears in the OP, who not only worked in this demo but also contributed to the Vulkan RT specifications released last week.