The strongest hero.

In other words, Sar-Elam undeservedly became a Dragon?

Why not? He deserved it, for his diligence and effort. But he couldn't have done it without help.

Well, even seven Dragons are no match for Askha.

She at least divided her knowledge in an orderly manner: light - to Elratu, air - to Silatu, the twilight aspect - to Malasse, and so on. And that is why the Dragons are unmatched in their element. And Urgash can only plunder and burn, so the demons inherited only the desire to destroy the world. This is where they are weak compared to the Dragons.

According to the hierarchical ladder, both Dragons and demon lords are second after Askha and Urgash, respectively.

Only in their own, demonic hierarchy, and even then, the demons perfectly understand that none of their lords can withstand a meeting with a Dragon, and therefore they do not emulate him. However, the Ashanites, for the most part, do not worship either of them. And the demons worship only Kha-Beleth. So their status is diminished. It's only on paper that they are equal to the Dragons.
Urgash created the lords not as conductors of order in the world, but only as leaders of his armies. Besides, the lords are not Primordial, and were created as servants, not allies. And servants, naturally, must be weaker than their master, even all together.

That's why I claim that the Overlord is at least not omnipotent and chose Railag in the poll (and, judging by all, the main arbiter of fate of Ashan, i.e., Ubisoft, agrees with me)

Omnipotent (not for Dragons), if not all-powerful, but to claim that Railag is stronger than the Overlord... Ha, Railag only managed to survive thanks to his friends and the fact that the Overlord cannot leave his prison.
Railag is the arbiter of fate of Ashan? What has he done for it that could have changed its fate? He could not influence the birth of the Messiah. So, he has not done anything significant. Except for killing Nicholas.