Well, re-rolling the demoness, I managed to defeat the Knight hero for the first time. It was a glorious battle. Key to it was to just dump the imps in reserve and split the demonesses, effectively using 2 high HP troops to tank the enemy's "heals". I played this fight 3 times, and on all 3 times, there was a volcano on the battlefield, so it goes beyond saying that the more you keep the enemy around it, the better
The 2x1 demonesses can swap troops around the battlefield as needed, preferably switching the Demon summoning with the Bowmen for an easy bowmen kill, as they suffer close combat penalties.
Whew. That was awesome. There does seem to be another Knight troop on the map, but it looks inaccessible. I am not the type of player to scream bug right away, so it might be a captured troop. Sadly, you can't kill it.