I think the idea of Fiends being spawned through evil is quite a compelling one. To expand further upon it, what if anyone who died Evil turned into a fiend? This could lead to some particularly interesting moral complications for the PCs. Do they try to make their enemies atone - risking that they fail and allow the evil to spread - or do they instead kill them to prevent any more people being corrupted even though they will risk creating a fiend that could come to haunt them in the future. (Possibly a good way of bringing back old enemies for the PCs). This could also lead impetus to the PCs not becoming murder-hobos and rather try and play the long game by turning enemies into allies.