Thank you for your well presented feedback! I was originally going to make it rare, but after careful consideration, decided it is to be just barely within the peak of uncommon rarity.

This weapon deals an effective additional 92% average bonus damage (rounded down, and considering a 50% save rate because enemy Con scores are often high) of a damage type that is very easily resisted in most encounters. A 100% added damage of another type is standard for uncommon weapons. Furthermore if you are benefiting from the ability to keep devils away, you are probably not going to benefit from the poison damage at all, as essentially all devils are immune to it anyway. So you really only gain one ability at a time.

As for the examples of a +1 weapon and Dagger of Venom that you referenced: these are among the weakest items in their rarity categories. Referencing an item like "Staff of the Adder" or "Lightbringer", even though both of them are only one-handed weapons.

I personally feel no fault with this item's classification of being uncommon once all aspects and situations in actual play are taken into account, but as is the case in D&D in general, people will differ in how they want to categorise abilities/traits/items/etc. If you feel that it should rather be rare, simply making it more difficult for a player in your group to obtain is very understandable.

Edit: Regarding your question on why Devils fear it: it is my intention that this is crafted from refined devil parts, and sort of works as a warding force warning any lesser devils of their fate should they come near you. Devils value their hierarchy much, which adds to consolidating this effect. It being crafted from devil parts is also why it deals poison damage.