The fluff is there to help you as the DM build a coherent fictional world.
First, without any explanation even to the GM, "there's a bearded devil with an intelligent glaive in a cell" seems to not make a lot of sense. "But why didn't they disarm him?" "These guys are devils, why is a devil in a cell?" etc. PCs tend to investigate things and want to know "why," so many times when they do I go to the fluff and let them uncover some of it, it builds the sense in them that the world is a logical one and it's not, as in 1e sometimes, "a huge dragon in a room with only 5' corridors going out of it." Frankly, even if they don't ask, by comforting you the GM that there is a reason (instead of just having a list of rooms with a monster listed in each) it makes you more confident in the game's fiction as well.
Second, they try to do this when there is a chance the PCs will interact with a NPC. In this case, they are in a cell, and can be spoken with without opening the cell door (in fact I am not sure why someone would open the door...). In cases like that, it's nice to have something to hang your hat on. (Not to harp on this specific encounter because you're asking in general, but it just says he's "mad" and "full of rage," it does NOT say he attacks the PCs on sight, which means he could potentially be enlisted as an ally against the villain - a crazy, evil ally, but hey). And don't forget they then get his intelligent glaive, which was a witness to those events. "Hey glaive what was the deal with that guy? "Uhhh...." Or maybe they capture someone else, a guard or whatnot, or they free someone else, and ask them "what was the deal with that devil down there..." There are many, many mouths information like this can issue from.
Third, even a detailed AP is meant to only be the starting off point for your own game. You are expected to expand on it, change it up, mash it up with other stuff, alter it to incorporate your own plots and characters, etc. By adding a little more info to the characters (in the case of the Howling Fiend, the fluff is exactly two sentences long) it provides a plethora of additional expansion hooks that a GM can use during adventure planning. When another devil shows up later, maybe he's not just a random encounter, maybe he's looking for his buddy Szasmir who went MIA a long time ago and now the PCs have a glaive that reeks of him.
Anyway, the actual killing of monsters and NPCs forms a reasonably small part of the overall action in a game of Pathfinder, the investigation and roleplay and all that form a huge part as well, and the fluff is there to fuel it.
Honestly, Don't Change Much
Warforged are widely considered the second or first strongest LA 0 race in 3.5, fighting with Humans (valiantly) for the top spot. If Humans didn't get much of a boost, 'Forged don't need to either. At most, I'd say to alter them for a net 0 if and only if humans got an ability score bonus. However, you may need to alter the text on the Living Construct subtype to make it compliant with any alterations in terminology that Pathfinder made - changes that are subtle enough to be difficult to reference off of the top of my head.
The only other thing to keep in mind is the idea of Favored Class bonuses, but I think that might be a little outside the scope of this question.
Best Answer
That's up to you, but there is a reward already
Kingmaker is a very sandboxy campaign, and if you actually sum up all the treasure, the party will likely be over their Wealth by Level. Especially if you add some random encounters during their exploration. The reward quest for that is explained on page 34:
Keep in mind that the quest given by the swordlords (which is a different quest) is to keep the kobolds activity under control, and resolving their conflict surely is a way of controlling it. That reward should be given regardless of the outcome. But of course, they will likely get a higher treasure total if they get the reward and also murder all the kobolds.
However, if you believe they are under WBL, you may also fix that by adding a few more exploration encounters that will reward them with treasures. But, by no means, the kobolds have to give the party their valuables.
In my group, the kobolds were hired to be scouts and miners in our kingdom, which translated as a free mine once we absorbed their hex and a tiny army of scouts that never actually got used, but were there defending the mine hex, which was far more valuable in the long run to us.