Most of the time demons count as mortal beings especially if they could be found out by powers giving strange signals like "there is no human here".
How does this relate to disbelief for mages? Do demons in cover generate disbelief?
Demons might pretend as much as they want that they are mortals but they aren't. They have no soul, no "God's spark", they can't be Awoken so they have no power of disbelief. Simple as that.
The general rule of WoD (both old and new) is "one splat can't use powers of another splat.
No
This has no risk of breaking the Cover as using this to detect a Demon can't actually differentiate them from a sleepwalker.
Any spell to detect sleepwalkers should report the Demon as one (or give the Demon a chance to spoof the detection so he shows up as one).