The smell is the following, teams get on stage to demo the results of the latest iteration and they have powerpoints ready with bullet points that describe what they have done (up to here nothing wrong as long as you really demo what you talk about), but also list in the presentation what they "delivered in part" or got "almost done" or even "done but not tested".
I felt unconfortable when I was watching this but could not put my finger to it. Later on after thinking about it I came up with the following idea. Maybe what the teams are doing is not really a demo of what was "done" (really done!) during the latest iteration, but they are really just justifying the time they spent in the iteration. I guess the thought on their mind is like this: "I just spent 4 weeks working, I better have enough bullets to impress my manager and her managers otherwise they'll ask tough questions".
Maybe I'm exagerating here, maybe these teams feel confortable with this approach, but what I cannot understand is why they don't think about their customers. If your customer attended your demo what do you think they'd like to see? A list of things that you "almost did" or "did but not tested"?
The demo should really be a real fire drill where you talk to the audience like they would be your customers and would be paying real money for real products. A demo is not a reporting session, you can do that as well, but that is not the focus of the demo.
How have you done your demos so far? Have you experienced this "smell"? How did you tackle this smell? (leave your experiences in a comment, I'd really like to get some inspiration on how to help these teams out).