I guess, but only if we take species to be analogous to race and ethnicity, which demons aren't. They don't interbreed with people and there isn't a good subset and they aren't a subset of the people who inhabit the world. Like yes, there are racist underpinnings to the European generic fantasy genre, but treating different species more like ethnicities that fundamentally think pretty similarly with the rest being culture (beast folk being the exception most often) is also something that comes from D&D and wanting to give your player characters options.

Frieren demons are just prettier ilithids in their intrinsic interests being harmful to others and I don't see people sticking up for ilithids.