Complex sentence: Dave Hill was impressed & arranged a day at Studio 51 to record another demo which although rough felt he had seen & heard enough "star potential" to suggest she form a more permanent regular band to record for his new label, Real Records.
Split into simpler sentences: Dave Hill was impressed and arranged a day at Studio 51 to record another demo. Although it was rough, he felt he had seen and heard enough "star potential" to suggest she form a more permanent regular band to record for his new label, Real Records.