Well, I have tried the stripped down demo on my old 2nd generation core i7 with a VERY old ati HD 2600 xt video card, and get similar results as people above. I also tried it on my newer core i5 laptop with integrated HD4400 and get slightly better frame rates. I tried it in IE, Chrome and FireFox.
While it certainly looks better when it is running at a buttery smooth 60 fps, I never felt it was unplayable - except in FireFox (at high resolutions) where I was getting around 15 fps and down into single digits and strange, buggy things would happen like swimming through rocks into open ocean, and animations going wacky occationally. (There's a lot of ocean out there.) At low resolutions FireFox behaved itself and was getting much better frame rates.
Input never felt laggy (just the frame rate got a little choppy). It might help to test if there was a specific task to do that required accurate timing to see if lower frame rates make it impossible (or more difficult) to play - rather than just not looking as smooth.
I understand your desire to make it look perfect, but for someone who knows they have old equipment, I think it looks more than good enough. (It looks fantastic!)
As for the "low quality fullscreen scaling" issue - I don't think it is a reasonable expectation that something should run at the same frame rate at any resolution. Any time you are scaling video you are adding a lot of extra work for the gpu. The more you are scaling it, the more work involved. Even though it is being rendered at a consistent size, the final output resolution will have an impact on performance.