On my way out of the underdark, in the koa-tua lair there is a statue that says I must sacrifice an animal. I did this and the Demon Knights summarily kicked my butt! Do I get the opportunity to come back to this spot later on if I want? Or should I rest, get some better spells memorized and grit my teeth for conflict? Is it worth fighting them even? Thanks

It is most definitely worth fighting them. They have some very good items, and good experience too. You can come back later if you want, but if you've done the underdark you should be able to do it. Remember that they cast power word kill, and power word stun (I think). A good way (but a bit cheesy) is to put all your party in the hallway so you only have to kill a couple at a time. Arrows (+1 or 2) work well as well.

Ohhhhhh yes they are worth fighting, they have certain items you may really want. They are tough to fight, I recommend the following spells to help you: negative plane protection, protection from petrification or free action and of coarse resist/remove fear. Keep a cleric nearby with mass cure also.

Oh, you have stumbled onto a very important part of the game (kinda..). These Demon Knights are considered to be fairly difficult, and they possess an artifact. I'm not too familiar with the matter, but what I do know should be enough to make you want to learn more on the matter. Just wait, I'm sure one of the more experienced players will stop by ;)

It is ABSOLUTELY worth beating these Demon Knights. Aside from standard party buffing spells, have your party summon in the 4 (not the max of 5) toughest monsters available and place them in a box around your party. You want to have each monster target its own demon knight, not all gang up on one. You must only summon 4, not the max of 5, because when you summon some poor animal or perhaps a wood nymph to trigger the battle, you don't want to exceed the max number of summoned monsters and accidently "delete" one of your summoned allies.

BTW ... For any of you who have ToB, did the statue in this room where you must place the animal sacrifice look vaguely familiar???? ;)

minor coded spoiler
.
.
.
.
.
.
.
.
.
.
.
.
.
"The Forgotten One" from the Watchers Keep perhaps ;)