All very good questions.
And all very hard to answer.
I think one key point is that some demons do it for power, some for boredom. I am reasonably certain those at the very top of the heap do it out of boredom.
In particular I know the Demon Princes love to give either encouraging or discouraging words to archdemons/greater demons and then watch them scramble. And half the time which they give is based on a die roll they secretly make. Ever notice how demon princes often have those little multi-fold screens on the table next to them. I think they are rolling dice behind them, just to see which way they want to screw with the rest of us.
From my experience, the younger demons are usually doing it for power, it’s the older and most powerful that do it for fun. A great deal of the enjoyment comes from the fact that the younger ones think the Demon Princes take things as seriously as they do.
Of course, that’s often said of the gods too.