Does the demon regain control?

No, and it's worse

Waverly stood in the middle of the stage in just the daisy dukes, before reaching up to hold the hat in front of her breasts. She didn't know what she was meant to do. Getting off stage didn't work, so that meant staying on stage, but if she was on stage she was meant to perform...

She shivered and felt countless eyes staring back at her.

She began to move, nervous, knowing that if she didn't it would only cause more trouble. It would have been easier if the... thing controlling her had returned, because at least then she wouldn't be the one doing it. She'd have something to blame.

There was no way to get this over with if she didn't strip though. Waverly trembled slightly, clinging onto the hat and with it what little modesty she could, bare knees knocking together as she debated the least humiliating way to get this over with.

If the demon wasn't going to take control, then she'd have to be the one to take her own clothes off, powering through the overwhelming embarrassment she felt rather than having something else do it for her.

She lowered the hat, hoping that the reality of exposing her breasts would convince her it wasn't as bad as she was imagining. Instead it was worse, the cheer that went up as what seemed like most of the town cheered at the sight of her made her cheeks burn.

Waverly turned around, hiding her face. She looked nervously towards the impatient manager. He wasn't showing any sympathy. Waverly bit her lip, lightly swaying her hips to fill the time as she tried to psyche herself up.

Take off her shorts, take off her panties, then it would be over. At least she hoped so.

Her hands were shaking so much she wasn't sure she was even physically capable of doing that, let alone mentally prepared to expose so much more of herself.