My take (spoilers)
The shaman and the demon are partners.
The Japanese demon (obviously symbolic of Japan's occupation of Korea) causes all of the illnesses and murders in the countryside. After a certain amount of time has passed, the shaman, a Korean man who is making money by selling a hybrid of foreign religions to rural villages, comes in an "defeats" him.
The demon gets his photos (essentially souls) and the shaman makes money. Then they travel to the next town and repeat the process - this is backed up by the deleted ending, which shows the demon trying to lure a child to him by a roadside, then being picked up in a car by the shaman and driving on.
The scene where the shaman and demon are both engaged in rituals seems to confuse people. Essentially, the shaman's ritual causes discomfort to the little girl, whereas the demon's ritual is an attempt to create a zombie (before he is struck down by the female nature spirit). Obviously, the director edited these scenes in such a way as to hide the fact that the shaman was in league with the demon by making it seem that the two rituals were connected.
Speaking of the female spirit, she seems to belong to the land and protect the village. She weakens the demon, casts him out of the forest, makes the shaman vomit blood and runs his car off the road using moths. We also see that she attempted to trap the demon earlier in the film by hanging her herbs near the house where the first bodies are found ... however, the villagers lack faith in the natural spirits of Korea, preferring to believe the shaman and his hybridized foreign religion or putting their faith in Christianity.
It doesn't seem like the female nature spirit can destroy either the demon or the shaman (she only physically interacts with one person at the film, at the very end), but is obviously powerful enough to force them out of the village.
The entire film is essentially a critique of how Korea has lost sight of it's own beliefs by putting its faith elsewhere, leaving it vulnerable to the ultimate evil (in this case, a combination of the Japanese and an otherworldly demon).
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