> In Flame Palace needs to fight against Demon Knight, but we have 2 different versions of Demon Knight: Mountain's one and Deserts's one (both number 4, but different max. power). What kinda of Demon do you mean?
Er... The Desert one. I'm going to quickly rename the other one (to Demon Healer) in a hotfix.
> Let me make sure, to move I can choose any ortogonal direction and move pawn for any numbers of open squares, counting water squares for damage, and then I'll make roll for event just for last square where I stopped?
That is correct, with the caveat that every square you pass through must already be scouted.
> Do Demon's clan get angry if I run away from the fight?
No; the demon lived, so there's no need to seek revenge.
> by using Hellgate can I teleport into unknown squares?
Yes; I might tweak that if I make a third version, but it's allowed now.