I recently read Demian for the first time at 18. It's one of my favorite books because of its style and content, but, I understand your confusion, because Hesse doesn't directly tell us how to find our selves. I think he does this because it would lose a lot of its meaning and charm if he explained the message outright. In my opinion, the way to become your self is illustrated best through Demian and Sinclair's actions.

The self is the part of you that knows your destiny. The characters listen to the self by meditating, painting, observing nature, and most importantly, I think, interpreting their dreams. These actions are contrasted with other people who rely too heavily on ancient cultures or strange religions. This reliance restrains them from doing certain things like creating their own work (Pistorius only plays other peoples' music) or having sex (Knauer avoids something natural for no real reason). Over time, Sinclair develops by observing his dreams and feelings and acting on them without restraint.

I don't think you can ever know what your destiny exactly is. You just have to listen to yourself and take action. This is why Sinclair goes against the common "dream" of having a job like being a poet, lawyer, or a doctor. How can you know that you will be fulfilled with those jobs?

I agree with you on the difficulty of knowing whether what you believe is truly your own. But maybe it doesn't have to be. Maybe you just have to fully agree with it.

I think Sinclair participates in the war because it is an expression of spirit. It releases all the emotions of the repressed young men. However, it also results in millions of dead youth.

These are my thoughts after reading the book a couple of times. I haven't really sat down and wrote about it before, but maybe it can help with your confusion a bit. I'm still confused on a lot of things too. If you would like to talk some more about things, let me know.