[Tancred]

If I recall correctly, one of the most irritating things about the 3rd level of The Keep are the 'magic' zones. Certain areas either make strange things happen ('wild surges' of magic) or kill it dead. The room you enter could well be one of those dead magic zones. Look for the telltale description in the dialogue window about the 'air tasting flat', or something. Remove Fear, alas, is identical to Resist Fear, right down to being counted as a spell effect.
Try a few spells in there. If they work, I must have remembered incorrectly. If not, then you're going to have to face the Fear. I'm not sure how the zone affects potions, though...

As far as the Pit Fiend goes, a Gated Pit Fiend will attack anything without a Protection From Evil upon it, even other Pit Fiends. The Pit Fiends in the room you're in are just different-looking versions... possibly with some stat differences.