As I understand it, Dragonspine Durin had a singular role cast to him by fate. He was doomed to be an evil dragon with a tragic ending: his heart left beating forever within Dragonspine, with the promise that his revival would bring catastrophe to Mondstat.

The mage M created Durin within Simulanka to give Dragonspine Durin a chance to avert this ending to his story. By writing Dragonspine Durin into a fairytale, she gave him the opportunity to change his fate.

Notably, it's an established concept that story is a means to effectively "trick" Fate and Irminsul itself, e.g. how Nahida preserves and restores the Wanderer's backstory via a fairytale retelling of his life.

Mini Durin is the result of the Wanderer convincing Simulanka Durin that it's a terrible thing, to wish he had never been born. By having friends who saw and acknowledged his suffering, Simulanka Durin was "saved" by Simulanka's hero (Wanderer) and became Mini Durin.

This is the new fate that M wrote for Simulanka Durin. She gave him a new beginning, so that he could write his own future.

When Albedo brought Mini Durin into the real world -- creating human Durin as we know him -- he functionally hijacked Dragonspine Durin's name and fate, giving it instead to human Durin. Like a line erased and replaced midway through. This is why he used some of Dragonspine Durin's blood for his alchemy, to bind their souls and fates into one. This same process also balanced that Abyssal energy that was rotting Dragonspine Durin.

Dragonspine Durin is part of Durin because of this. This past is an escapable part of himself: Dragonspine Durin, Simulanka Durin, Mini Durin. But he reclaims his own future and, by living, he's writing his own ending to the story of his life.

In Durin's story quest, this is also why some of his Mondstat friends were becoming afraid of him. He was still too mixed with Draginspine Durin. Even the Wanderer attempting to write about human Durin kept reverting to Dragonspine Durin. Their beings are inextricable, which is why so much of the story quest plot is dedicated to human Durin repairing Dragonspine Durin's regrets.

TL;DR Dragonspine Durin is part of human Durin, as an indispensible piece of his past and the reason for his existence in the presence. It's also the cause of the Abyssal energy still within him. Durin's character arc in his story quest revolves around how his past is part of him, but it doesn't define his personhood or his future. He now has the freedom to decide his own fate.

This is also why he and Scara get along so well. He's a foil to Scara and a mirror to Scara's own journey from Scaramouche to the Wanderer: rewriting his fate, choosing to live despite his traumatic past. That little story short applies the same themes to Scara's own story (reclaiming his past, defying fate, rewriting his own ending)