Pretty sure the demo was tracked in August ‘93, shortly before Michael started the third leg of the Dangerous tour, then everything went to hell once the Chandler accusations popped up.
I think August '93 is too late for that Demo. The release date that was set for the single was October 18, 1993. And on August 26, 1993 the third leg of Dangerous Word Tour started. The false allegations broke on August 18, 1993.
The most logical conclusion for me would be that this song and Ghosts were recorded earlier in 1993 and then they were scrapped because of contractual difficulties with Paramount Pictures.
We also know that the scrapped music video was filmed without any dance scenes as the music wasn't done yet.
So if the Demo is recorded in August of 1993 and if the music video was being filmed at the same time, there would be no time to finish it because of the Dangerous World Tour.
So, it is more logical that both the song and the video were being done earlier in 1993 and that they were cancelled because something other than false allegations. Because even if allegations never happened, I don't see when MJ would have time to finish the music and video!
When Dangerous Tour, third leg started, MJ had no time to come back to States to finish the music (record his vocals), and to film all the missing dance scenes with heavy special effects in the post production.
The only time during the 3rd leg that he had more days off was between Europe and South America from September 26, 1993 to October 8, 1993, but that would be too close to the release date. The movie came out on November 19, 1993.
There is a version of the song where Bryan Loren sings the verses, that Korgnex has, so the lyrics must have been written. Maybe it was intended to be a duet song, something similar to Do The Bartman but with more MJ on the chorus? Either way, there would still be no time to film the dance scenes for the music video. Also in my opinion, that song is not very "dancable" so my opinion is that Ghosts song would have been the dance number. We know that MJ worked on it in 1993 (with Teddy Riley?) because that is the year of the leaked multitracks with Pavarotti intro. That also has unfinished lyrics!
Even though the short film was called "Is It Scary?", I don't believe Is It Scary (song) would actually be featured in the video as music for that song was composed by Jimmy Jam & Terry Lewis a year later (at least) during the HIStory sessions. I think that name was used for the video because of the line MJ says in it. And that that line influenced MJ to write the song around the music composed by Jam & Lewis for the HIStory album. Or did MJ write the song first, and then they composed the music around it? I believe the first one is more logical as that's how they worked on Scream & Tabloid Junkie (maybe HIStory as well).
These are all just my opinions. If someone has exact recording and filming dates, or some book with reliable sources, please comment.