The Hellfire event creates several hellfire improvements across the map, and places a demonic Champion on each. This champion will belong to the Infernals if they are in the game, or the barbarians otherwise.
The Hellfire Improvement itself can spawn champions the same way barrows spawn skeletons. IIrc, in the unmodded game these champions have the barbarian default race of Orc instead of demon, and appear human as the Orc Champion art was removed when the Ogre was made a UU for that unit.
In my version the units spawned this way would be Balors instead. I think I may change that though, as Barbarian Balors in my modmod are fairly weak due to Balors' strength coming mostly from affinity and the barbarian state not having access to mana. (I wish there was an easy way to go back to the pre-BtS way of making the barbarians count as owning all the mana anyone else does.)
Also, in my version Hellfire increases the tile's plot counter to 100, making it hell terrain. It also has a chance of discovering evil mana types.
I'm thinking of making it a permanent feature, so that instead of disappearing whenever a unit not allied with the barbarian state enters it would be removed though the sanctify spell or exploring it as a lair.