Oh yay, another demon thread!
I work primarily with demons, though not the sort you'd find in ceremonial texts. Those I work with are more like Faerie or Yokai than whatever infernal hierarchy Judeo-Christianity cooked up.
The word 'demon' itself is derived from ancient Greek 'daemones', which is usually translated to mean 'wise' or 'divine' spirit. The Greeks knew two main types of demons, the 'eudemons', who were good spirits, and 'cadodemons', who were evil. Both were widely considered transformed spirits of the dead, the former often serving mortals as guardians, while the latter caused all sorts of mischief.
From my own experience, a demon is a darker spirit who may be benign, malignant or entirely neutral. Most were human spirits at one point, and transformed after death for reasons yet unclear to me. I've come to think of them as spirits of emotion, as they are so often inextricably linked with such, and indeed appear to feed from it.
For example, an incubus is a demon of lust, and sustains himself by inspiring lust in others and feeding on the resulting energy. Another sort(which I've taken to calling 'fiends') feeds on pain and suffering, and thus will dwell in places where these emotions are rampant, if not inspiring them himself.
I've also noted that the emotions demons are identified with are regarded as unpleasant, such as the aforementioned lust and pain, and also fear, thirst, hunger and rage. I'd also link them to certain forms of insanity.
Conversely, this does not necessitate that demons are inherently evil. Strange as it may sound, I've known many whom struggled with their natures to the point of denial, self-hatred and profound depression. I've additionally found that they can be some of the kindest, most sympathetic spirits you'd ever hope to come across.
I agree with you on demons having that capacity for kindness, etc. I've not dealt with demons, but coming from my xtian background, anything that wasn't god was evil. I tend to look at demons as another kind of spirit, and from the people I've spoken to, if you treat the demon with respect it will treat you with respect. But, as you say there are some demons who love negativity, so one has to be careful that whatever you call up you can banish if needed.