The thing is, they don't, since this game is being developed by a different studio to MM9.
The head positions of the dev team - director, lead artist, UI designer, etc - are mostly different, although there is some overlap. However Comcept are likely to have a lot of support staff that are working on this that worked on MN9.
The fact that Comcept co-develops with other studios doesn't change the fact that they have staff of their own that work on these projects.
Can I ask what the definition of 'insanity' is?
I think you're fishing for the joke "doing the same thing twice and expecting different results" definition. I'd agree if the Legends 3 demo was released and did poorly. But Capcom never even gave it a chance, so this isn't not the same thing. Fans have been saying for years that they'd totally have supported the demo if they'd been given the chance. Of course this isn't Legends 3, but it's got a lot of the same people working on it, so it's not surprising they thought fans meant it when they said they'd buy a shorter self-contained game to prove they want a bigger expanded one. If anything, comcept's been acting sane, trying to make a separate smaller self-contained demo and expecting the same results, i.e. Legends fans saying that they're willing to support it to get the expanded game.
The prologue is not the 'reason why Red Ash should fail'. It 'should' fail, hypothetically, so that they can polish up and have more to show.
Staff have done multiple interviews in Japan and America, they've arranged things with multiple partners, they've passed the halfway point in funding, gotten a large amount of press attention, and they've made promises to backers that will cut into their own take of profits from any publishing deal. At this point there's a good chance it will get funded, although how many stretch deals it may hit is up in the air. If it doesn't, however, Comcept is not going to walk it off and risk putting it on kickstarter just to be humiliated again. That's not going to happen. In the unlikely event that they even continue trying to make it, they'd be doing it with bits and pieces of profit from other games, meaning that the release would be pushed back by years. They're in way too deep at this point to just call for a "do-over" on the kickstarter.
I was in for $90 on day one, but this thing has been all kinds of mishandled. The straw that broke the camel's back is the one day sale shit. No, no, no. Pulled out entirely. You don't get to fake a "last day drive" scenario this early and keep my pledge.
They said that everyone who pledged at least $49 before the 17th is essentially getting "early bird" status with the pledge to get the expanded game, and they decided to include anyone that also pledged on the 17th to keep things simple. That's not faking a "last day" scenario. Maybe if they had a countdown with Inafune on twitch today... but they don't.