Answer: The right answer is the B) There are many demons.
Explanation: Just to elaborate a little on the answer, it can be added that on their way to the Castle-in-the-Air to rescue the Princesses, Milo, Tock, and Humbug encounter the demons. This stage direction is mentioned right after Tock's reply to Humbug: "Not just one [not just one demon, he means], I’m afraid. If you want to see what I’m talking about, then turn around." If there are hundreds of eyes, the director is suggesting that there are many demons surrounding them.