Why was Louis XVI referred to as Louis Capet instead of Louis Bourbon when he was stripped of his royal titles?

[EDIT: This was initially intended as a response to Ookoo_The_Master's question, now removed here, about why the revolutionaries wished to 'make him more human' instead of 'demonise' him.]

As JQuilty mentions, it's not so much to 'demonise', and certainly not -- to reverse your own terms -- to dehumanise him. Instead, 'Capet' as a last name renders him an ordinary citizen, mockingly so by caricaturists, but invoked by the deputies in late 1792 particularly to stress equality in front of the law. Justice, in other words, would no longer distinguish rank, including royalty; its use hence stripped him of his title of roi, without claim to divine monarchy.

If we tease things out a little, however, perhaps it can provide an even clearer picture of this sort of revolutionary iconography and language. On one hand, your question is perfectly warranted. But it supposes that they wish to 'demonize the old regime', as if that's synonymous with Louis. In reality, republicanism was never really a popular movement until the Flight to Varennes in 1791, and even then public opinion was often torn between support for the king as led by many of the Assembly (in defence of the king, note) and a myriad of possibilities to introduce republicanism. (Transitioning from an at least putative constitutional monarchy to a republic was never as easy, in the political discourse of 1791's republican movement, as simply killing the king.)

Louis had moreover always been subject to libelles and caricatures. But it was after the invasion of June 1792 that depictions mocking him -- varied in representation, though including that classic image of the corpulent king with the lopsided liberty cap sitting shamefully atop his head -- circulated with the words Repique est Capet. Accompanied by derisive iconography and verse, then, the appellation is used as another form of ridicule (see especially the work on A. Duprat on caricatures of the king). And while, as I stress, republicanism was not inevitable in 1791, the revolution saw a gradual erosion of royal ritual when it came to ceremonies with the Assembly, with a culmination of sorts after August 1792 (the best writing on this is de Baecque's 1994 article). In December of the same year, at his trial in the Convention, the silk chair he had been accustomed to had disappeared. In its place was one of austere simplicity. As one observer wrote (quoted in de Baecque, 1994):

... Louis Capet appeared without trappings but nonetheless with dignity. He was undoubtedly quite astonished to see no other seat prepared for him but a humble chair in a place where he had more than once deployed all the pride and pomp of royalty. You will recall, readers, the silken armchair and the fleurs-de-lis that so insulted the national representatives. With what astonishment would the thirty-one kings of the infamous Capetian line be seized in seeing their descendant despoiled of all his ceremonies.

My point is that the use of 'Capet' has to be read as part of a general republican sentiment as it played out in such changes of sacrality and ceremony, but that it can't always be conflated with other political tensions.