Goblin Queen (She/Her/Hers)
Yes, the 5e lore casts gnolls as demon-spawn. The problem is, the people (such as myself) who want playable gnolls don’t like that lore, and don’t want gnolls to be fiends at all. Maybe if you kept the same lore, but had them look like horrible monsters, people would be more accepting of it, but the fact of the matter is, they look like anthropomorphic hyenas. You combine an animal and a human, and inevitably a huge number of people will find it sympathetic. Folks want their cool hyena people, and they don’t want them to be always-evil monsters created from tainted demon meat.5e lore says they are born of normal hyenas that were corrupted by demon ichor. New gnolls are created when hyenas (and sometimes other creatures) eat dead gnoll meat and transform into "adult" gnolls. They barely work with any other races, create no tools or living spaces, only communicate in the simplest terms, and have no families or young.
This is very different than previous edition lore, and some exceptions (such as Eberron) exist. They were set up to be basically unnatural engines of terror and destruction that orcs could only dream of being, and it's been soundly rejected by people who just want a hyena-headed PC race.
I don't imagine a 'gnoll 2.0" will fair much better.