Here's a quote from Bruce Campbell about AoD in the TV show:

It's about referencing specific events of AoD within the A v ED script dialog… like Sheela and the particulars of the story. Since you saw him travel to a medieval realm in ED2, they can mention this basic plot element in passing, but that's it.

We saw a shot from the end of "Evil Dead 2." That's the only way they could bring up Ash's time traveling exploits. Universal wouldn't give Raimi the rights to use "Army of Darkness." F'n Comcast!!

Can't disagree with you enough about finally seeing the demon in the woods. It's the fact you NEVER SAW IT that made it creepy. Now, it's just that smoke creature from Lost!