Isn't the Source Engine a bit outdated?

No. Source was WAY ahead whenever it first came out. Now, I think other engines are catching up.

Also, I finally played the demo. It is Awesome.

If you don't get stuck with an idiot who doesn't understand things like:
Don't shoot me!
Revive me!
Here is a medkit. Stop running away.
Stay together.
Don't touch the goddamn car.

Then, it's not so awesome.

The source engine has been modified as well. Portal and tf2 look somewhat better than half life 2.

i played the demo yesterday and its really awesome, i cant even feel the crappy-ness of the older source engine anymore

Whilst I found it fun to play with my mates particularly at the hectic sequences, I am a little worried at the overall length of the finished title. The blurb at the end of the demo states 20 levels...well was that demo 2 levels? If the main game consists of four stories split into five chapters will that be enough to remain entertaining after 10/20/30 play throughs of each level. Personally this is one that I'll be looking out for pre owned after Christmas.

All this said, it does what it says on the tin nicely, saw no frame rate drops or v-sync issues even when jumping on the car like the afore mentioned paedo on top difficulty.