First, thank you. It pleases me that people think more in depth about the story.
To respond to your points:
A. Yes. The mortal kingdoms are dying. A lot of people cannot feed themselves, let alone afford shelter. Hence the growing number of slaves, and bandits. Perhaps not 20%...more like 10-15. And the tailor is the daughter of a rich man...not depicted yet. But your point stands overall.
B. Only collared slaves, with the brand on the neck, must obey no matter what. The normal slaves cannot lie, but retain their free will. And you can only
talk to your slave telepathically. And you need to be a mage for that. If a slave is not collared, he/she can decide for herself to follow the order or not. And suffer the consequences...
C. True to an extent. Very few mages could overcome Athagan's brand. But the MC has a lot of raw power, but lacks control. A future scene explains that: it is like a door with a lock. Athagan's brand is like a strong oak door reinforced by metal with a complex and well-built lock. Henri's door has no lock to speak of, but is made of steel and weighs 20 tons...with a little extra something on top.
You also need to be in physical contact with the slave to transfer a brand.
It is also punishable by death/slavery to steal a slave from its owner...and the owner feel when the brand is broken/taken over.
D. Atetans are nearly the most powerful mages in the mortal world, second only to the high elves. In part because they like to mingle sexually with other races, which makes them more likely to end up with arcane-sensitive genes into them.
But high elves have an incredibly low birth rate...and their manners make them unappealing to other races so they are less likely to interbreed, and without strong allies too.
When it comes to the arcane, Aetas is the standard that other human countries compare themselves to.
E. I don't see how, at least in Aetas. You must have access to the slave to overcome the brand. And the owner would be warned immediately. The type of uprising you think of is just not possible.
Of course, in other countries where they use more archaic brands...and tend to collar all their slaves...who knows...
The demons do not need to do that anyways. They are winning. The population is declining. A few centuries ago, the level of technology was more akin to the Victorian era, with magic mixed into it. They had black powder guns. Skyships with cannons. They were free of diseases and the crops were bountiful. Now...well, more like dark/middle ages after a plague. A lot was lost.
Demons thought that the time was right a couple decades ago or so. But a single group of 5 individuals thwarted their plans. Enough for the armies of the mortal kingdoms to win in the field at least.
As for the asset, I think it's included in HS1. Not sure. All the versions I tried had it...but I never installed HS from scratch. I am sure I did not add it as a mod though.