Did Jesus imply that demons are fallen spirits sided with Satan?
Short Answer: Definitely. Whether they have a choice is another matter.
The Gospel of Luke (10:17-20) is hardly the only place where we learn this. There is one passage that unequivocally describes the activities of all dark forces working against us:
Ephesians 6:12: "For our struggle is not against flesh and blood, but against the rulers, against the powers, against the world forces of this darkness, against the spiritual forces of wickedness in the heavenly places" (emphasis added).
We might understand that God is a Being with absolute power. Nothing can occur without His permission. Therefore, the "forces of wickedness in the heavenly places" in the Letter to the Ephesians above must be referring to spiritual places — not "heavenly ones" per se.
Whether these beings "side" with Satan is pretty clear; they are almost certainly his ministers, just as celestial majesties (real angels) are God's ministers (Heb. 1:14). These figures are not only characterized as demons, but also unclean spirits, the Devil's angels, and so forth. From the Gospel of Matthew we read:
Matthew 25:41: "“Then He will also say to those on His left, ‘Depart from Me, accursed ones, into the eternal fire which has been prepared for the devil and his angels" (emphasis added).
The word "angel" here must surely mean "messenger" — and that would be "messengers of the Devil." As well, if this "eternal fire" had been prepared for anyone else, it seems we might have been told about it. Yet, we only read "the devil and his angels". Very curious indeed.
Suppose we consider what a messenger of the Devil, or messenger of Satan may actually be. Are not those who teach "doctrines of demons" messengers of Satan?:
1 Timothy 4:1: "But the Spirit explicitly says that in later times some will fall away from the faith, paying attention to deceitful spirits and doctrines of demons" (emphasis added).
Just who is "the Spirit" referring to here? Are these not human beings that "fall away from the faith", "pay attention to deceitful spirits", and espouse "doctrines of demons"? What about those who try to lead us astray; are they not manipulated by "deceitful spirits" as instruments of Satan? If not, just who are they?
Curiously, the "accursed ones" to be cast into the eternal fire are never referred to as human beings. However, is this not the final destination of all lost spirits, including human ones?
Here, we should remember that we, as human beings, have a dual nature: one physical, and one spiritual (2 Cor. 4:16). Obviously, our physical body will return to the dust of the ground (Gen. 3:19). Just who are we outside our bodies of flesh and bone? And, if we are lost, how is our spirit not unclean to God?
We have a bit more information on demons that may be relevant. In Luke's Gospel we read:
Luke 8:29a, 30-31: "For [Jesus] had commanded the unclean spirit to come out of the man. 30And Jesus asked [the demon possessed man in the tombs], 'What is your name?' And he said, 'Legion'; for many demons [unclean spirits] had entered him. 31They were imploring Him not to command them to go away into the abyss" (emphasis added).
Note the word "abyss" in verse 31. This is important because it appears we are cautioned against speculating over who may be saved, and who may be lost:
Romans 10:6b-7: "“DO NOT SAY IN YOUR HEART... ‘WHO WILL DESCEND INTO THE ABYSS?’" (cf. Deu. 30:12).
This is clearly referring to lost human beings that face the very real prospect of imprisonment in Hades, a prelude to the "eternal fire" (Matt. 25:41). The more we contemplate the identity of unclean spirits, the more it seems apparent that they are "unclean" because they were never washed in the blood of he Lamb; they refused to accept God on His terms.
Instead, they rejected His offer and now (1 Pet. 3:19) exist as nothing more than the spirits of the lost. Imagine a vicious, dead giant from the days of Noah, a blood thirsty killer that would never hesitate to destroy us. What might he do if given one unique opportunity? Is he not working directly in alliance with Satan?
Luke 11:24: "When the unclean spirit goes out of a man, it passes through waterless places [the rich man in Hades pleaded for water] seeking rest, and not finding any, it says, 'I will return to my house [human body] from which I came [possessed].'"
Often, we feel that angels are like human beings, but they are not. God's celestial majesties have no sexual component (Matt. 22:30, Mk. 12:25) and cannot die (Lk. 20:36) while demons always yearn to be clothed with a human body. Is it not at least plausible that a demon would feel most comfortable in human flesh because it was once similarly clothed?
Irrespective of their identity, yes, it seems certain that these malevolent beings are ministers of Satan.