Demodex - is a genus of tiny parasitic mites which live in or near hair follicles of mammals. Infestation with Demodex mites is common and usually does not cause any symptoms; occasionally some skin diseases can be caused by the mites.
Sarcoptic– can cause scabies , which is highly contagious infestation of Sarcoptes scabiei canis, a burrowing mite.The canine sarcoptic mite can also infest humans and cats, although usually not severely, as its natural host is dogs, and it cannot reproduce on other animals.
Symptoms 
Demodex  - Irregularly shaped, mildly irritated areas of hair loss.  The skin is usually not inflamed and the lesions are not highly pruritic (itchy). 
Sarcoptic - lesions are very pruritic, inflamed and scabs may be present. 
Pinna-Pedal Reflex Test - Take the Pinna(ear flap)between your thumb and forefinger and vigorously scratch the surface of the underside of the Pinna with the forefinger. 
Dogs with no mites seldom work the back leg in a scratching motion.  Dogs with sarcoptic mites almost always will demonstrate an involuntary scratching motion with the back leg while you are scratching the Pinna.
See the video - http://www.thepetcenter.com/exa/PinnaPedal.asf
Treatment
Demodex Mange
- Most      cases of Demodectic mites are self-limiting. The animal is able to arrest      the reproduction and growth of the mites and eventually repair the damage      they do.  
 - Dogs      with very mild, localized, small skin lesions some veterinarians do not      treat the dog at all.  Other veterinarians will always treat a      Demodex lesion with topical medications appropriate as an insecticide
 
Sarcoptic Mange 
- Affected      dogs need to be isolated from other dogs and their bedding, and places      they have occupied must be thoroughly cleaned. Other dogs in contact with      a diagnosed case should be evaluated and treated. Sulfurated lime rinses      applied weekly or bi-weekly are effective. 
 - Selamectin is      licensed for treatment by veterinary prescription in several countries; it      is applied as a drip-on directly to the skin. 
 - Unlicensed,      but frequently used, ivermectin, given by mouth for two to four weekly treatments;      this drug is not safe to use on collie-like herding dogs. 
 - While      giving any treatment the age & health condition of the dog should be considered
 - In      case of puppies stress should be given on immunity development and severe medication      should be done in severe cases only.
 
Links
http://www.thepetcenter.com/exa/mites.html
http://www.thepetcenter.com/exa/dem.html
http://www.findarticles.com/p/articles/mi_m1272/is_2705_132/ai_113302303
http://www.bhvet.com.au/petcare/dogmites.php