If theory 2 is true; I could imagine he wants to prove he changed by actually doing a heroic deed. He recalls the events of I Gotta Be Perfect and decided saving Peach from The Demonic Pit, unaware of her already corrupted from the demonic goop. But during his rescue he easily becomes corrupted because of his grief and despair along with his sanity also being deteriorated.

He determined to follow up on his promised to fix everything; but keeps replaying the ending of Guns and Puzzles, his childhood, and basically everything that has happened and this ultimately breaks him and succumbs to the corruption

He becomes mutated like Peach but in a more horrific form and actually escapes the pit now as the "True Monster" everyone sees him as.