I know this question is over a year old and you may have an answer already.
I saw that you were last on 2 months ago. So here goes.
Since your Demon has pretty much the same rear wheel well clearance as my duster...
I currently have 17X8's with 4.5 inch backspace on the rear. I put on 255/50R17 tires on it, Which comes out to almost 27" diameter, but with only about 2-4 choices of tires.
255/45R17 is slightly better choice wise 4-5+. And at 26 inch diameter.
Going down to 255/40R17's will net you a sizable choice of tires (30+) but the diameter is on the small side. (25 inches)
Here is my duster with the 17X8 (4.5" BS) and 255/50R17 Riken Raptors:
The back of the tire is about .75 inches from the spring.
This is with an 8.25 Rear end... Your demon likely has an 8.75 which if I not mistaking sticks out slightly more out on the sides vs. the 8.25's
I'm also putting together an 8.75 myself with a rear disk brake kit and aftermarket BBP axle shafts, I'm also going to put on a different set of wheels.
The new set of rear wheels are 17X9 with 4.6 inch backspace and I'm looking at 275/40 (25.7") or 285/40 (26.0") tires.
*The 275/40's being the much more common size.*
The fronts are going to be 17X8 (currently 17X7)
The front end looks a little high because I just took it off the jack.