I do prefer the original name of Squats - from an age when GWS had an undercurrent of tongue-in-cheek humour. It seems to have been lost in recent years
Demiurgs are not squats, they are one the xenos races allied with the Tau Empire, just like vespids or kroots. But they are also like technological space dwarves, just as squats were, who are vaguely still present in the background as part of the Imperium. Just a bit of history
I don't think we could declare one type of dwarf as being unbelievable and another not! Isn't that a bit like asking if someone believes in the tooth fairy (no) and then suggesting that the fairuadyin (which are similar to fairies) are believable! They'll be carting us off in restraining jackets 🤔. The old Squat background was pretty unique anyway - certainly as original as a steampunk derived dwarf race
Ah, you are right, I could have written in other words. I mean (and not squats,by the way) that most GW races were pretty generic as the whole world and their fluff was too one-sided and straightforward, which is why it's hard to believe that such could really be alive. This problem, of course, didn't disappear - entire fluff of Khorne and partially orcs one has this disease as well, I find such background always stupid and boring, but if orcs in AoS have their own interesting bits and funny details, Khorne has not. The biggest flaw of GW fluff since the time out of mind I'd presume.