Yep, there really is such a beast. (Or at least one called a vampire - the marine biologist who named it had a sense of humor...) The thing has an umbrella like membrane that stretches between it's tentacles. And instead of suckers it has barbs. Oh, and despite being called an octopus it is actually a squid, the two extra tentacles are just very small...
I don't know what the 'ears' are for though...)
William Beebe (1926) described V. infernalis as "a very small but terrible octopus, black as night with ivory white jaws and blood red eyes". In truth it, like most octopi (even if it is a squid.. maybe) is quite shy and retiring.
Check out:
http://www.nhm.ac.uk/hosted_sites/tcp/vsfh.html
http://www.dal.ca/~ceph/TCP/vampy.html
Bebe was one of my childhood heroes... his descriptions of his bathyscaphic journeying being more gripping than is the wont for scholarly discourse.
I had a teacher with an octopus as a pet, it was sweet tempered, and learned several tricks. (It actually liked people, even strangers.) How to pull itself up and 'plop' through a hoop, and how to shake hands... and yes, shaking hands with a three inch octopus feels exactly the way you'd think it would.
Giant octopi are often curious and even friendly. There is nothing stranger than watching two divers playing 'frisbee' with a large octopus - with the octopus as the frisbee, then seeing the octopus come back to continue playing. Needless to say, giant octopi are hardly villainous in my campaign.
The Auld Grump, no I was not a child in 1926...