Sensei has so much shit wrong with him it'd take a while to unpack comprehensively.
In short;
He definitely is narcissistic even if sometimes he denigrates himself and does not suffer from grandiosity.
Lying to/emotionally manipulating everyone is just fine to him.
He generally experiences only negative emotionality, even if he telegraphs differently to others.
Most damningly, he absolutely aschews emotional connection and intimacy (when he tells Ami how much he cares for her at her parents' grave player Sensei asks something like 'who is saying this?' ) and does not want to care about others.
Sometimes he is also impulsive and psychopathic (when under the influence of... one of the gods or something).
And of course (ignoring the 'why this happens' of the plot) he suffers from horrible hallucinations, distorted thoughts, and has been shown to fully misinterpret what someone is saying (IE the Yumi event on the second beach trip).
I should also say that his believing himself to inhabit the body of someone else sets him up for the narcissistic condition, just by itself.
Think of Sensei's reincarnation in LIL as through the lens of the 'false self' of a narcissist.
Created to distance the true self from the possibility of hurt, the callous false self goes on to predate and (intentionally or not) harm the lives of anyone who associates with it.
It should be mentioned that even when he is told by Maya he really might be 'himself', he still goes on to treat everyone parasitically.
He treats them as existing more or less for his entertainment, even if this is not in a sexual sense.
Of course, he still justifies his predation. Very few people want to be evil.
But Sensei is more than just that.
There is some portion of good that is being suppressed somehow, by some mechanism.
You see it try to poke out every now and then...
I have a feeling it will be a very long time before we see that other voice Sensei's 'good' side in control...