I don't think the character of Demandred has been wasted as such. He certainly got disserved by the sheer length of the series, his build-up lasted like forever, but otherwise it isn't such a bad option to have kept him in reserve, careful not to undermine his aura like that of the other Forsaken characters who occupied the front of the stage and thus showed their flaws, and reveal him only as the central foe for the LB.

I think Demandred owes a great deal of the interest he sparks in some of the reader base mostly to the fact Jordan managed to keep him mysterious all along. It wouldn't have served Jordan better to reveal more tidbits about Demandred's plans only to frustrate the readers because Demandred's preparations wouldn't come into play before the LB.

Otherwise, Demandred's personality as someone unable to cope with the fact someone else succeeded better than him is that of the sort of character mostly interesting if developped with some psychological depth, and RJ never was a psychological writer. It also didn't help that the core of that story happened as back story and Demandred and Rand couldn't possibly repeat it or continue it credibly, except on a battlefield. That's why I think Jordan chose to introduce Taim and Logain as complementary and opposite substitutes for the Barid Bel Medar type of character near Rand, a way to show us a similar story, similar relationships and issues, without going back all the time to the AOL details themselves.

The bonus is that as Demandred enters the stage for real at last, that he finally commands a side of the War at last (rather than being one of the top generals), Jordan put a wrench in that and gave him a "second" that has many of the traits of Barid Bel Medar, and is likely not to be much more loyal to Demandred than Demandred was to LTT.