You are wrong, but also right. The story is minimalistic for a reason. It's up to you to interpret it yourself. You call Darmin a "demon dude" but does the game ever tell you that he really is evil? Perhaps it's those who banished him that are evil? And same applies for the collosi. Are they evil monsters or just innocent beings that gets slain one after the other by the wanderer?
The truth is that nobody can give an definite answer to every plot detail. You have to find your own answers.