Prologue: Back-story of Darkness
For thousands of years, humans have always feared the darkness. This darkness gained power as Netherworlds, lawless lands filled with vicious monsters, started to increase in number. This story focuses on a Netherworld resident, but you should know about what happened beforehand, when war threatened to destroy a world that had not even been born yet. People must learn the basic knowledge about the Netherworlds, how they work, gain power and standing, and how Nether Law works. Another thing that is crucial is what happened before the story's events.
The Netherworlds are the lands of demons, creatures of so-called by human standards evil, that humans think that prey on the weak. In actuality, most demons are far more likely to battle with their own kind than pick on humans. The Netherworlds always have one area controlled by its ruler: the Overlord. Some larger Netherworlds also have local Demon Lords who swear their undying loyalty to their Netherworld's Overlord. This was the system used in most Netherworlds, but there were some exceptions. One Netherworld set itself up as a school with the Overlord as Dean and the greater demons as Teachers and Administration.
Netherworld residents become powerful off of the fear energy that humans produce. To harvest this fear energy, demons set out to a nearby human world and start committing atrocities such as murder and burning down settlements. Some demons are so powerful that their mere presence is enough to harvest fear energy from the cowering population. This also explains how Netherworlds gain power and standing throughout the cosmos. If more human worlds connected to a Netherworld, that means more fear energy to harvest, and it means more power for demons.
Nether Law is very different from human law. In the Netherworld, laws exist only to be broken, because felonies are to demons as war medals are to humans. Only certain atrocities of great caliber, talking about Supreme Tyrant Baal, and questioning the Overlord are ever dealt with. For most of these crimes, the perpetrator is locked up in a Netherworld Prison for copious amounts of time. The few crimes that are not punished with jail time are met with death; specifically treason and rebelling (IF you get captured by Netherworld soldiers, as they usually kill you.) Felonies bring great power and notoriety to demons so they are always trying to break these laws.
As for the conflict before our story, this takes place in the Netherworld that had been attached to the world of Hylia, 4000 years before the events of Skyward Sword®. This was back when feudal Angels ruled the Netherworlds, oppressing the demons so that they could not use their frightening power. When this occurred, Angels were very stubborn and believed that demons, no matter where they lived, were absolute evil and that they were absolute good (both of these ideas later proved to be false.)
One day, seven extremely powerful demons conquered the Mountain of Ordeals in their home Netherworld and set out to liberate their oppressed allies. These demons were: Death King Thanatos, Demon God Pestilence, Gargoyle Chief Pazuzu, Thief Lord Avarice, Elemental Leader Barsk, back-then General Baal, and Lesser Noble Vasilos. They went to war with the Angels to kick them out of the Netherworlds, starting with liberating theirs. As demons throughout the Netherworlds overthrew their former angelic masters, the Angels realized that if they continued to rule over demons with an iron fist, they would be hunted into extinction. So Seraph Lamington signed a peace treaty with the seven demons who braved the Mountain of Ordeals. This treaty became known as the Demon-Angel treaty and established peace and several rules for the Netherworlds and the land of the Angels known as Celestia.
4 years after the treaty was signed, Baal took control of several Netherworlds, effectively being promoted from General to Supreme Tyrant. Noticing that Baal was becoming more and more evil as time passed, the other six demons that conquered Ordeal Mountain took action. Demon God Pestilence, Gargoyle Chief Pazuzu, Death King Thanatos, Elemental Leader Barsk, Lesser Noble Vasilos, and Thief Lord Avarice decided to fight Baal when the tyrant heard about a relic of omnipotent power. He moved to seize the relic known as the Triforce but was stopped at the planet Mars by his six former allies.
The battle began when Baal fired a lightning shot at Vasilos, who dodged it and retaliated with three fireballs that merely smoked the Tyrant. Thanatos struck next with his scythe which interrupted Baal and prevented him from casting the Hurricane spell. Pazuzu hit the Tyrant with two claw rakes that left nasty scars on him. Baal then used his deadly Sword Rain attack and managed to wound Pazuzu and Vasilos. Angered, Barsk and Avarice attacked Baal, Barsk with the powerful Ultima spell and Avarice literally back-stabbed the Tyrant. Pestilence then moved and attacked Baal with several sword strikes, knocking him down and defeating the Tyrant with a fatal blow. In an attempt to take his former allies with him, Baal cast two spells, one of which seeded the red planet with an unknown material; the other would have caused a black hole to consume the planet if Thanatos didn't act immediately and interrupted the spell with another scythe blow.
Demon God Pestilence, Gargoyle Chief Pazuzu, Death King Thanatos, Elemental Leader Barsk, Lesser Noble Vasilos, and Thief Lord Avarice used powerful magic to seal Baal into a statue inside a dark tower on an outcropping of rock situated inside a massive cosmic storm. After they did that, they made it impossible to locate the tower itself by enchanting it with powerful black magic; then they finally placed a magic seal on the tower itself to prevent entry.