Trust me to jump in on a discussion like this. 

I think we need to clarify something about this question:
What do we mean by 'including' something in our stories?
I hear a ton of people saying "I don't put demons in my stories," or "I don't put drinking in my stories," etc.
From what I can tell, they say this because these things are bad.
Which is true.
But that is not a reason to not put them in your book. Far from it. Otherwise, we would not have any lying, stealing, ungodly decisions, anger, or any other sort of sin at all in them. Which would be ridiculous.
Even the Bible has demons, lying, stealing, murders, rape, evil gods, witchcraft, etc. It doesn't always condemn them whenever they occur, either (though of course it condemns them elsewhere).
So the question is not whether they should be in our stories, but how we should present them.
That...
is a big question. So I will not get off-topic and start on the intriguing tangent of presenting sin in a way that does not help others stumble in the presentation. 

Instead, I would like to address the original question, framed a bit differently (to help keep things on-topic):
"How should we represent evil incarnate in our stories, when we decide to do so?"
When I say 'evil incarnate' I mean a physical representation of an evil sapient being which does not have an option to repent. Like, a demon.
If it has an option to repent (as in a cursed person, or a witch, or something like that, which is evil, but is not beyond hope), then it doesn't fit this criteria and doesn't apply to the question.
People manifest evil in various forms, some using things from legend, like werewolves, vampires, gods, etc. (Some other people use these things for other uses that are not evil incarnate, and that is fine.) Some people use very unique and new ways to manifest their evil beings (like I do, hehe).
Because these beings have no choice to go back, they of course cannot repent. Because of this, they don't really work as 
the Main Character of stories. It can be done, of course, but it is generally a bit too hard for more people to handle. Haha.
Of course, they can be used quite easily as 
a Main Character. The primary antagonist can be evil incarnate very naturally. You can also have the henchman of the MC be evil incarnate, and then betray him in the story. That can be fun. (For the writer, not for the MC, of course.)
As for representing them as good.
They aren't good, so making them be good, is obviously an oxymoron of the highest degree. 

But they can do good things, and good can come from what they do. This is true to real-life principles. Satan blesses people, as well as God. They may even help a person do something that is good (even though it isn't what God would prefer they did). God can also use what they intend for evil, for good. He has to do that a lot.
(Please don't get into a debate on free-will and predestination here...)
As for me, I have demons in my stories, and they feature quite prominently in them. In fact, I have three in particular that my stories all seem to gravitate towards and congregate around them. Which makes sense, since they are the three in the High Lord of Darkness's High Command. They always seem to have their fingers in everything.
One of them happens to be present in the Character Introduction thread at the moment, actually.