Dark Souls was streamlined from Demon's Souls and was a better game for it.
I don't know about that. It was less linear, there were more weapons and items, a couple new moves, more upgrade paths, the addition of covenants, addition of pyromancy, limited healing resources, more complicated multiplayer stuff.
You could call removing world tendency streamlining, but to be honest I don't think that ever worked the way it was supposed to anyway. The covenants definitely could have been more effective, but I think over all they were a more interesting feature than the easily exploitable karma from DeS.
The switch from Healing Herbs to the automatically replenishable Estus Flasks is a prime example of streamlining done exactly right. It "limits" healing, yes, but more to the point it also eradicates the need and, to a large extent, the ability to grind for healing items. (There's Humanity, but it was much harder to get in the vanilla game, so most wouldn't bother.) We won't know for sure until the game comes out, but I hope, and suspect, that this is exactly the sort of thing that they're talking about - at least in theory - when they say they want to streamline to deliver more of the "essence" of Dark Souls. They did not want Dark Souls to be about grinding for stuff, so they did away with a game element that encouraged it. Seems like a good decision to me.
I do agree that the daunting refusal to explain things is a big part of the charm of Dark Souls, and what makes it so engaging, but as I see it, it has no intrinsic value - it's good only insofar as it improves the play experience and atmosphere of the game. If the game can be made more readily understandable without sacrificing the underlying feeling of solitude, danger and indifference towards the player, then I'd call that a net win. In Dark Souls, too, there is a careful balance at work; while the game did add new features that arguably increase the complexity of the game, such as the nonlinearity (which I liked a great deal), other features such as bonfires, Estus, Vancian magic and the addition of Pyromancy as a type of magic usable by melee characters all serve to make the game both easier to balance for the developers and more legible for players.
Now, the question is if the things that made Dark Souls so great will survive whatever changes that will be made in the sequel, but I think it's just as much a matter of implementation as it is a matter of principle and theory. Like Tanimura there says, "balance". Who knows if they'll get it right? As I see it, though, there are game elements in Dark Souls that could be further clarified without a net loss for the game, including some of those more complicated multiplayer elements, a few of which did not work terribly well anyway. At any rate, the developers are pretty dedicated to the idea that Dark Souls II should feel hard, inaccessible and nigh-impenetrable, so their hearts seem to be in the right place. For the rest, we'll have to wait and see.