I recommend you ignore the first battle with and head through the door and take it on in the next area as for the status alignments he puts you in set up some gambits for one character to instantly heal that alignment (if you have the correct gambits and magicks)

Get one character to be a ranged attacker (fran or balthier) as they demon wall cant physically get to them but can cast immoblisega (which was a pain in the butt)

If this doesnt help go outside and do some leveling up or get some better armor and weapons

Oh and if you have the magick (Raise) set up the gambit for a character to revive a fallen character