I think they became portrayed as they are in modern culture through modern, and historic religions. The devil is horned, hoofed, and winged, and so one automatically assumes that his demons are akin to his likeness, like we are of god. (In the Christian religion, anyway). I also think that people see demons as "reality but different", humanoid, but little changes making a big difference, such as goats legs, horns, and sharp teeth. I think Demons are also symbolic of fear. It was a belief once, that bad dreams where caused when a lesser Demon sat upon its victims chest, and fed off their fear.

I think they reach back that far, too! I think people weren't so 'blinded' by science and upbringing in the first ages of man, and so the world was as it was, and thus, the spiritual existence of a secondary plane was a very open reality.

I think it is good for both entities, yes. The 'emigrating' spirit gets to stay in it's chosen dimension, whilst the hooked entity shares the emigrating spirit's knowledge and strengths, with also a strengthened eye to the spirit world. Who knows, maybe people with "Multiple personality disorders" may have simply been hooked by a spirit, wanting to stay here, and simply works on the same wavelength as the spirit.