First, let me say....in this I will be using the terms evil and bad. For the purpose of this writing, they are interchangeable. It was difficult sticking to one or the other.
What is the devil's job? Many would say it's to tempt some from their path to lead them down a path of evil ways. If that is the case, does the devil create evil or does the devil merely exploit the inherent evil that is within us all? If the devil were to create evil, wouldn't that mean that some were born to be evil? That they were created with the sole purpose of doing evil? What hope is there then? However, if the devil's duty is to exploit the evil all have inside, then we would still have free will. We would have to choose to take those paths into evilness. But, we could choose to take the paths back to good.
What determines an action to be good or bad? Do those actions decide whether we are good or bad? Or, is it other's reactions that decide if we are good or bad? Maybe it's not so black and white. Maybe we have to allow for the grey.
I choose to believe that we are all good and evil. There isn't some mythological deity out there trying to pull our strings. We decide our own path. A path that goes through light and darkness, sometimes at the same time. When faced with a choice, ask "Who will be harmed (physically, emotionally, spiritually, psychologically, financially, and all the other ally's out there) if I choose this path?" The ideal answer would be nobody, but that's not reality. Every thing you do will affect someone somewhere somehow, even if only minutely. The best choice is the one where you benefit the most with the least amount of damage. To those around you who support you, the choice would be good. To those who are harmed, the choice would be deemed evil or bad. There's the grey.
So, what's the point of all this rambling? The one normally deemed Villain in stories is the one who accepts this and acknowledges that the so-called heroes of the world aren't completely good.