I think mandemons exist because they are easy to corrupt.
Elfdemons might be hard to achive, but carries the important benefit that they live longer than dwarves. Devote tons of resources to make a demon that will die in hundred years or so is surely waste of money.
We could also note that there is not many demonic traits missing from dwarves before they turn as unpleasant as demon. Short, uggly, smelly, beardy, violent, greedy...not much room for improvement.