Here is a few other events to put the Flight into perspective:
1. The "Greyhawk Wars" raged from 582-584 CY. Much of Iuz and Ivid V's might was due to the influence of many demons and devils summoned by way of gates.
"The Blackspear Chamber is Iuz's gate to the Abyss. Fiends are summoned through it and upon their return to the Abyss, the powerful nexus strengthens them..."
-Iuz the Evil
"Baalzephon guided Ivenzen's men to the Cauldron of Night and instructed the priests and wizards how to fashion the malachite throne. The baatezu offered diabolic aid in the form of spinagon and barbazu troops for the House of Naelax. Further, it gave the House of Naelax dark magical artifacts which the overking and his mages hold to this day...In return, Baalzephon asked for two things. First, the House of Naelax had to agree to cease all dealings with tanar'ri—except for enslaving them and banishing them. Second, Baalzephon graciously demanded the souls of Ivenzen's heirs and descendants for 888 years—should they rule from the malachite throne."
-Ivid the Undying
"Ivid's own throne room is a 40-yard diameter circular chamber with the great malachite throne set into the north wall...Once per week, if the correct command word is uttered, the throne can be used to open a gate to the uppermost of the Nine Hells."
-Ivid the Undying
2. Delegates sign the Pact of Greyhawk ending the Greyhawk Wars in Harvester 584 CY. Rary "the Traitor" tries to subvert the Great Signing, killing Tenser and Otiluke in the process. When Rary fails to stop the signing, he flees to the Bright Desert and sets up his own realm with some planar aid.
"He summoned yugoloth and other creatures from the planes, and ordered them to transport Rary' Tower, as well as Robilar and his army, into the Bright Desert. There he ordered the yugoloth to construct a fortress for his new headquarters."
-Rary the Traitor
3. Circa 576 CY, at the behest of the Circle of Eight, a band of heroes liberate the Crook of Rao in the adventure Isle of the Ape, thus foiling the Witch Queen Iggwilv and her demonic allies. After this event, the Crook goes out of sight until it seemingly comes to Rel Astra post-wars.
"The Crook of Rao then passed from view for a time, until it resurfaced in the Great Kingdom following the Greyhawk Wars in the hands of the LordProtector of Rel Astra, an animus known as Drax the Invulnerable. How he acquired it is unknown, but some speculate it was lost by an agent of the Circle of Eight seeking to relieve the forces of Commandant Osson of Almor before their destruction in Medegia."
-The Crook of Rao, Oerth Journal #3 by Eric L. Boyd
"Rumors abound that the Lord Protector of Rel Astra. Drax the Invulnerable, has made known he has acquired a powerful artifact of Good. sacred in the Power Rao. He has offered this to the rulers of Veluna in trade for magical items more useful to the forces of Rel Astra. Veluna's Canon Hazen is depserate to have the artifact and is said to looking for powerful adventurers to travel to Rel Astra and back."
"This mission is important enough that Hazen's second-in-command, Patriarch Lemuel will accompany the PCs."
"Chaotic evil enemies of Veluna will not be pleased to see a mighty artifact of lawful good retrieved (Iuz is the obvious case)."
-From the Ashes, Atlas of the Flanaess
The Flight of Fiends and its Aftermath:
Indeed, the Flight of Fiends was made possible not because of the wisdom of the Circle of Eight, but due to their misguidance or carelessness and of course the greed of Drax, who likely didn't know what the Crook could really do. Using the Crook of Rao was no small matter.
"In Coldeven 586, Canon Hazen of Veluna employed the Crook of Rao, a powerful artifact, in a special ceremony that purged the Flanaess of nearly all fiends inhabiting it. Outsiders summoned by Iuz, Ivid, or independent evils fell victim to this magical assault, which became known as the Flight of Fiends."
"In a stirring private ceremony attended by the entire College of Bishops, Canon Hazen (along, it is said, with the help from the archmage Bigby of Mitrik) employed the fabulous artifact to trigger the Flight of Fiends."
-Living Greyhawk Gazetteer
Whatever the Circle of Eight's internal politics was during the Greyhawk Wars, at least Bigby redeemed himself by helping with the Flight as well as assisting Veluna in pursuing Iuz afterward:
"...word spread through Furyondy of an extraordinary event. The great fiends that had patrolled and ravaged the many lands seized by Iuz were no longer in sight."
"...the artifact known as the Crook of Rao had been recovered, and it had been used by His Venerable Reverence, Canon Hazen, aided by many lesser priests and the archmage Bigby, to rid the Flanaess of the fiends' presence. Reports confirming the absence of those monstrosities conflicted with later news that a few fiends in scattered locations had withstood the Crook's effect and remained at large. Still, a majority of these demons had been cast from the Oerth, back into the depths of their home planes."
-Greyhawk, the Adventure Begins
"Without his support structure of fiendish officers, Iuz's armies lost much of their striking power and organization. Belvor knew well that this chaos would not last forever. Furyondy's plight demanded action. At great cost to his own power and holdings, King Belvor IV initiated the Great Northern Crusade."
"Bereft of their powerful masters, many lesser nonhumans and ambitious human generals attempted to stage coups throughout the occupied lands, even as rebel bandits and indigenous populations took advantage of the Flight of Fiends to strike back at their oppressors."
-Living Greyhawk Gazetteer
Meanwhile, in the Great Kingdom, things weren't so hot for mad overking Ivid either:
"Immediately after the Flight of Fiends, it was announced in Rauxes that Ivid V was no longer overking, though it is unclear if he had actually died. Conflict engulfed the capital in a matter of hours as many of Ivid's generals and nobles, filled with rage and ambition, marched upon Rauxes. No one can explain the events that followed, but the city itself was soon engulfed in a strange magical field. Few willingly approach Rauxes now, given the bizarre eldritch forces that prevail where the ruined city stands."
-Living Greyhawk Gazetteer
Did the Flight of Fiends have any lasting impact? Certainly the Great Kingdom was already smashed apart before then. The Flight of Fiends removed Ivid's last, best means to keep his very powerful rivals (wizard, animus, death knight, etc) in check. With Ivid gone, the east was up for grabs. Back in the west, the Great North Crusade in just three years, resulted in reversing many of the losses that Furyondy and the Shield Lands suffered in the Greyhawk Wars, the main victory coming in the Battle of Crockport (with Bigby's help). Some of the Bandit Lands and Stonehold also shook free of the yoke of Iuz's evil for now. Unfortunately, Iuz the Old still managed to bring the fighting to a stalemate despite the "permanent and unalterable state of war" declared by Belvor.
By 591 CY, as Belvor predicted it seems, Iuz either started summoning demons again or perhaps the proximity of his permanent Abyssal gate in Dorakaa protected some of them.
"Even after the Flight of Fiends, demons walk the grim battlements..."
"No one knows how many demons survived the Flight of Fiends in 586 CY; few have surfaced."
-Living Greyhawk Gazetteer
Post-Flight it's said Hazen, who was already old, was too weak to get out except in special occasions, like announcing the Great Northern Crusade. The Crook of Rao like Hazen, was kept out of sight during the intervening years. This is the only snippet I could find on what happened in Living Greyhawk play concerning Hazen and the Crook:
"In events that take place in the Living Greyhawk campaign, it is revealed that three Raoan priests were tricked into betraying Canon Hazen by accepting magical curses which transcribed the true names of 101 demons onto their skin in the forms of magical tattoos. These 303 demons were not banished. It is further revealed that most of the powerful demons left of their own accord to make the ceremony appear more successful than it truly was. In the aftermath, the Canon has rarely been seen due to his weakened condition and the Crook has lost most of its power."-The Crook in Living Greyhawk
My Speculation and Conclusions:
1. It's glaringly important to ask, why did the Crook become lost soon after it was recovered by heroes in Isle of the Ape? Eric Boyd's war-focused theory is pretty solid for why it ended up in the Great Kingdom. A more scandalous reason however, is that Mordenkainen (who is not only obsessed with the Blood War between fiends, but also the Balance) wanted the wars to continue and dropped the Crook off in Rel Astra for his own twisted ends.
2. Did the Flight of Fiends directly affect Rauxes or the Malachite Throne? It's not known for sure how the capital of the Great kingdom fell to magical ruin, but Ivid or another wizard trying to use a broken Malachite Throne to summon more devils and accidentally destroying the city would make a pretty cinematic scene.
3. Did all of Rary the Traitor's yugoloth minions get unsummoned during the Flight or were they already released from service after constructing his fortress? This would have to be addressed for any campaign that uses this area in post-586 CY.
4. Can the Crook be used again to abjure evil on a grand scale? Not likely according to LG sources, but author Roger Moore in The Adventure Begins leaves the door open for it to be used again in some fashion. Due to his great age, Hazen would surely be replaced in anyone's campaign at some point. Perhaps a promoted Patriarch Lemuel would be strong enough to power the artifact again.
Now, I understand there is a thematic reason to always have a Big Bad Evil Guy like Iuz at the center of the World of Greyhawk setting. I just think in hindsight, Iuz's ever-present, unbeatable evil made the Flight of Fiends less spectacular, especially once the demons started to inevitably creep back in (see Paizo's Savage Tide). The retrieval of the Crook of Rao and the Flight of Fiends should have been the Greyhawk equivalent of blowing up the Death Star in New Hope which led to the defeat of Emperor Palpatine in Return of the Jedi.
6. The Flight of Fiends was meant to turn the tide for Good. Rather than someday using the Crook for Flight of Fiends 2.0, future Greyhawk authors should look to build on the Flight and Crusade by chipping away at the Old One even more. Develop the Soul Husk Caverns or have the REAL Vatun unite the north this time. Or hell have Mayaheine actually do something; wasn't she physically brought to Oerth to help Furyondy fight Iuz? There's plenty of work left to be done, Iuz must be vanquished. The Flight of Fiends should not go to waste.