Shane was a self-interested, murderous demon, and could not change, but Merle--the racist, sexist, violent criminal turns a corner before the end, thus the stereotype was melting
Shane was not, as he went along, anything like a "good guy," but I don't think "murderous demon" is a fair characterization.
It is fair. Not long after his childhood/best friend returns, he's aiming a rifle at him. Remember, they were nowhere near the season 2 level conflict at that point, but he considered murdering...his best friend.
Sounds like a murderous demon to me.
Let's not forget he murdered Otis by shooting him in the leg, to become walker dinner. I will not even entertain the notion that it was for the "greater good" of saving Carl. It was about his sick Lori obsession more than anything else.
No other member of the group would have shot Otis (based on how they were established up to that point).
He tried to kill Rick (attempt #2) at the school.
Then, there's Randall--murdered--and for what? To lure Rick out to the woods to kill him.
That's not surviving in the zombie world, as others (aside from the unhinged Governor) manage without plotting to kill at every turn. That is being a murderous demon.
And, sometimes, he was right (the walker barn for example).
No, that was not right. The zombies had been contained for some time, and never escaped. By opening the barn, and initiating the chaos to follow, Shane accomplished:
1. Sending Herschel to the bar, which leads to the entire Randall affair, including more conflict between Rick & Shane (triggered by Shane).
If Shane left the barn alone, it is arguable that the group would have been better prepared to deal with the coming walker herd, as they would have had all hands on deck, so to speak (not to mention more ammo), instead of being scattered in the woods, leading to desperate decision making (ex. Jimmy's failed rescue misison at the barn).
2. Carol was losing hope of ever seeing Sophia again, but thanks to Shane, her reunion was a devastating blow of gruesome finality. In short, he did not help matters.
Opening the barn accomplished nothing--other than giving Shane more self-made excuses to plot against his best friend.
The only choice for the survival of the group was to bring an end to Shane. Carol even comments on his poor leadership abilities (to Daryl) early in this season.
It says much that Merle--of all people--displayed mercy to Michonne..actually listened to her, when Shane only heard the brutal grunting between his ears.