Eh feels like a bit of a lazy outcome if it just gets resolved like this, Idaten side seems to have done absolutely nothing except training in the 27 years since Ysley and Paula were captured and just allowed the demon tentacles to spread.
Also I don't really see how some humans having demon tentacles means they suddenly need to co-exist with actual demons, maybe they figure that since Humans are pretty much acting like how the demons were previously there really isn't any difference between them anymore?
Major issue is that idaten have a weird apathy and indecisiveness when it comes to resolving human conflicts. Even Gil who was formed with the core purpose to protect is aimless and struggles to intervene and is unable to pick a side in a conflict with a clear aggressor. This entire phenomena might be an inherent failsafe built into the idaten due to them being formed from thoughts of salvation; they are meant to secure the existence of species that created them but not rule over them.
The main issue however is the nature of intelligent demons. They are not
demons, as demons do not possess intelligence. They have a human brain in a body made of demonic tissue, so they are humans with demonic traits; demonic transhumans if you will.
There is absolutely nothing that separates full-body enhanced soldiers and Demon Lord's intelligent demons from each other. Both are biologically identical; a body fully composed of demonic cells sheltering a human brain. The only difference between them is the exact method of their creation and their culture.
The soldier is considering himself a human who has been augmented with demonic implants. Demon Lord's followers consider themselves to be demons gifted with intelligence. It's purely a matter of perspective dependent on what they were told when growing up.
This is why Miku says they've won. Neither side wants pure demons to exist and they don't need to. They've made humanity dependent on demonic power and essentially caused humanity to domesticate the demons by incorporating them into themselves, and the idaten won't do anything as long as the demon hybrids identify as humans. They cannot tell the difference and ultimately do not really care.
The idaten were so confused when they first encountered these new hybrids. They didn't consider Nickel to be a demon; they thought they were just an enhanced human who could be a possible asset to fight demons with considering their power. The only thing that drove the Idaten to exterminate them was their own insistence that they were
demons lead by a demon lord to destroy humanity. They will not intervene as long as it's merely humans killing each other, even with demonic implants.
The demon lord has to fulfill the idaten need to protect his creator race, and that condition is fulfilled by human/demon hybrids. The war is over.
