BioShock was the first M game I ever bought, and I just finished it a few days ago. It is my new favourite game! (There is no demo by the way.) I was super creeped out in the beginning few levels, I had never played a shooter game before so I was freaked.
However, it was not as scary as I feared it to be. It creeps you out in the beginning when you are learning the controls and are unsure about the enemies, but you get over it fairly quickly.
Surprisingly, it is not too graphic, I barely saw any blood at all while I was fighting the Splicers. However, there is a fair amount of blood on the walls and floor, but it is for atmospheric reasons only. When you shoot someone, normally you see very little blood. If you hit them with the wrench however, you will see quite a bit more. Overall, once you get the hang of it, you will hardly be fazed.