I had a three-striped damsel that grew to be--no lie--5 inches long. He was beautiful and he was my favorite fish, but he was a monster. He killed any fish put in with him except the slightly smaller blue damsel that lived with him since they were small.
How big is the blue devil in comparison to the three-stripes? The biggest problem I've experienced with damsels is if they're bigger than another fish, the smaller fish is going to get picked on and possibly killed.
If the blue devil is about the same size, here's what I'd do... put the two three-stripes into a QT tank for the time being. If you don't have one, turn a pasta strained upside-down in the tank with the three-stripes trapped underneath it. This will indeed stress them out a bit, but damsels are incredibly hardy, and I'd be really surprised if this killed them.
While they're quarrantined, rearrange the rockwork in your tank. Give your blue devil a few hours to try and devleop his own territory within the tank. If the three-stripes are in a QT, I'd give it a few days, but if they're under a pasta strainer or something like that you don't want to keep them like that for more than a few hours, or it'd be cruel. Then release the two three-stripes into the tank again, and hopefully the blue devil will have the upper hand this time.
If you try something like this and the blue devil still gets picked on for more than a few days, I'd look to either trade in the blue devil or the three-stripes, especially if the three-stripes are substantially bigger.
As far as other fish go, I'd get something bigger than your damels. I lost a coral beauty to a larger damsel, and I had a friend who lost a green mandarin, a coral beauty, a purple pseudochromis, and some other fish to the monster three-stripe I mentioned earlier. So if you plan on keeping the damsels (or even one of them), make sure whatever other fish you purchase are at least the same size--the bigger the better--and aren't incredibly shy fish. A maroon clown or a royal gramma would be a good candidate, IMO.
Hope everything works out!!