regarding Paladins, they didn't "destroy the lore" they rather just expanded on things, prior to 5th edition Paladins where a narrowly defined holy warrior restricted via westren chivalric values. Whichw as totally fine back in the day when D&D was first created, but things have evolved a bit since then, and I'm not just talking society out of the game eaither, as settings such as forgotten realms got more and more complex, the need to address "holy warriors" of other gods etc cropped up and various editions of D&D attempted to work with this in differant ways. AD&D had various kits, third edition had the divine champion presige class, no one cares what 4th edition did, 5th edition approuches this with differant types of vows. the tradtional paladin is an oath of devotation. that is the classic pally with the classic pally rules etc.
There are however other oaths you can make, there's the Oath of the ancients which while it doesn't specificly say, sounds very much like a eleven Paladin, the oath of vengence, which might work for a more evil character. And the supplements have added other opions, including the oath of conquest which honestly works well for lawful evil characters. and the DMG includes rules for "oathbreaker paladins" which yeah.. it's the 5th edition equivilant of the blackguard and is in the DMG for a reason.
So TLDR, no paladins aren't running around serving demons. but lawful evil pallies might exist.
Faerun didn't get "more complex" since 3.5, they dumbed it down. They tried to wipe continents off the map. The destroyed entire planes of existence. The Blood War is over because it makes no sense now that there aren't any alignments and alignments don't affect the Planes in the same fashion. They even gave Asmodeus a new backstory that introduces the Christian god into the setting, rather than one that fits his status as Lawful Evil personified.
Idk how you can call this anything but "destroying the lore". Not paladins per se, but the entire world surrounding paladins that makes their context- and the Planes themselves- not have meaning anymore. As one person said, it is as different to previous versions of DnD in form and story as Pathfinder is.
