I personally think that Demonhosts just like minotaurs are something new we need to learn to deal with first. I don’t think he is horribly unbalanced. Hard for sure, but not impossible. But it’s an incredible slog to kill 5 or 6 of them in one mission because they spawned unavoidable.
Therefore i propose: Leave him as is, but treat him as a single entity per level. Even heal him for all i care, but if he is killed once, he should not appear again. If he manages to kill two players and retreats thats ok. But fighting him too often is more of a slog than it is fun.
Is it really? If it is directly infront of where you need to get through? When it is directly infront of the chokepoint of a large area, then it is not optional. I certainly noticed that it sometimes is, but maybe i just had way too much bad luck. Needing to kill 5 out of 6 encounters in a level to progress does not seem “optional”.