Well, there was the Anilords and the Time Warriors a thousand years ago which is really lead by an arcdeamon. It nearly succeed in inslaving entire Astlan I think. Still, there are people who rises up who are able to defeat the demon.
these ‘Demons’ also are still quite human in heart and body. Not to mention demons seem to be fighting with each other. So essentially these things might not really get into their mind that much.
There is also those people who seems to be dedicated at slaying them like the Rods. Wizards also arent’t really that helpless. There are really a large number of people who could fight demons.
Also there are demons who breed with humans. Antfalken seems to be a womanizer, sleeping with countless women and siring countless of children. He is an epitome of a deadbeat dad, creator of fatherless children it seems.