The first thing you want to do is bind your detpack at 5, 10, and 20 seconds ("+det5", "+det10", "+det20"). Throwing MIRV grenades should also be bound ("+gren2"). These weapons are extremely powerful. Be careful not kill yourself and teammates however. Obviously, you want to set the detpack where a lot of your enemies are going to be. It can be difficult, however, finding a safe place to stay while you arm the thing. Try hiding in shadows or going underwater. As for detonation times, make sure you choose a time which allows you to run away (unless you like suicide). 5 seconds is rather quick, but also makes it hard for the enemy to retreat in time. 20 seconds is sometimes a good idea, especially if you expect foes to be in the area sometime in the future. In any case, damage doesn't change depending on the fuse time.
As for the MIRV grenandes, you don't have to use them sparingly as you have to do with other classes (The Hwguy only starts out with one). Scatter them around in the enemy base, throw them behind you as you run, toss a few right before you die, and bounce them into corners or hallways where you think the enemy lurks! They're also the weapon of choice against Sentries. However, you've got to be close enough to throw them in order to be effective. Do the same with your pipebombs, they're great because they stay until the enemy runs over them. Keep in mind, however, that each team only can have a limited number of pipebombs present in the game at any given time. It's probably a good idea to check to see if there's a Demoman guarding your flag with pipebombs before you start using your own. Flag defense should come first, and it wouldn't be very good disrupting your own defense by overusing them yourself.
Finally, we have the "regular grenade launcher". Be careful with this toy, though. It probably causes more suicides than the rocket launcher. Obviously its not a good idea to launch grenades in the direction you're running in. I primarily use it as an anti-chase weapon, by firing it to the side or the back. Bouncing grenades off a low ceiling onto your foes also works. Also, its great to rain grenades on the heads of enemies, or lob them onto balconies where Snipers hide out. If you are about to launch a grenade at some unsuspecting enemy, it's a good idea to drop a few grenades around them instead of trying for a direct hit. A direct hit is more likely to damage the enemy and will launch them to a new location, where you'd have to adjust and fire again.
Remember your shotgun however. If you're pursuading someone I wouldn't recomend to use the grenade-launcher since you would most likely end up killing yourself.

AGAINST

If you see a Demoman standing anywhere for a few seconds,assume he's setting up a detpack. It will look like he's holding his axe if you get a good look. Attack before he's successful! If he is, run! (Or get blown to bits) Unfortunately, those detpacks can be hard to spot ... they often blend in with the ground and are awfully small. If you happen to see one, assume its an enemy one and retreat!
Watch out for MIRV grenades. They're often used right after a Demoman dies. Most Demomen tend to be kami-kazis and will surely leave some grenades next to their corpse. Be sure to get the hell out of the area. Don't let the Demoman get the after-death frag. Learn to take the Demoman out from a distance ... you certainly don't want to get one of his grenades in the face. Also, watch out for grenades and pipe bombs on the floor. Pipebombs, fortunately, are quite easy to spot. Try to get the Demoman to prematurely set them off, by popping in and out of the room they're in. If you're lucky, the dumb Demoman might be standing on top of his own pipebombs! Remember that the demoman is not an offencive unit if there are large distances between you.