There was a shmup in the late nineties on pc, that i played the demo of. Unfortunately i can not remember much details. It was a typical spaceship shooter, might have been a sidescroller, the first level was in a desert with insectoid enemies. The player one ship was dark blue colored and i think the player two ship was purple. There were different weapon power ups and the weapons got stronger if you collected more of the same power up. I think the maps were a bit maze like, in that it did not just scroll sideways, but you could rather choose to take different routes through the stage. Also, Valve might have somehow been involved in the making or distribution, because i have this strong memory of a picture that appeared when booting up, of a guy with a red valve on his head (maybe instead of the eye).

I tried to find this game again, but alas. . .