i can certainly recommend the Demon, the one pictured above is mine! it rides lovely, just incase people thought it wouldn't get ridden, here's a little xc vid i did for fun.
regarding the best steel hardtail though, there are so many out there and they can be aimed at so many different styles of riding, only you know what riding you do, i could have bought something for a longer fork or heavier duty but it wouldn't have suited my riding style and i think that is the key, admitting what type of rider you are, i'm old school xc, not happy jumping etc so i built the bike with that in mind from the frame up to the component choices. if you know you lean a particular way then find a brand that makes something that plays to your strengths as a rider. if you are a bit of an animal there's no point looking for the lightweight option! on the other hand if you're a superlight xc boy doing long rides don't go looking at an abuse based frame, it's common sense really but fashion and the mags try and convince you otherwise!
also if you do go down the custom route, regardless of the builder, look to your past frames and take from them the things you like whether it's geometry, tubing, cable stops, drop out choice, future proofing etc, all very important.