Reflex can be turned off and when used lowers your rating, and people at E3 said they already fixed the instant alert issue.
Didn't people at E3 only see the same footage we have here? Because you can see as soon as he Fultons the POW, a guy spots him, the player misses the Reflex Mode shot, then the guy shouts and it's pretty much an immediate base-wide Alert with three more guys showing up to shoot you. Maybe it's just a scripted thing for this tightly controlled demo, I guess.
It's not exactly unrealistic, though. Guards calling in to HQ made sense in MGS2 because they were separated into small areas on the Tanker and Big Shell. Here, though, and same thing with Ground Zeroes, you've got a few dozen guys all patrolling within shouting distance of eachother. All it should take is one guy shouting 'CONTACT' for everyone in the area to come running.