Demon's Souls refer to the souls of named bosses you receive when they are defeated. When you defeat each boss, it would be in your best interest to not consume its soul if it is your first time playing through the game. Boss souls can be used by Blacksmith Ed to make unique weapons or by Sage Freke, Yuria, The Witch, or Saint Urbain to make Magic Spells and Miracles.
How Soul and Body Form Weigh in on Boss Fights
Ultimately, how difficult each boss fight is for your character is dependent on your equipment (Weapons and Armor), your spells (Magic and Miracles), your tactics, (Head-On Assault, Hit and Run, etc.) and your skill (How well you can avoid being hit / How well you can block). Not your Form.
A Note on Blue Phantoms and Boss Fights
The more phantoms you have aiding you in your boss fight (max is 2, any more than 2 is a glitch), the more HP the boss will have. This means nothing, however, if your Blue Phantoms are decent damage dealers and stay alive for the duration of the battle.
