I cannot see Iago as anything but a villain! He betrays everyone around him who cares about him: his employer Othello, his friend Roderigo and his wife Emilia. Beyond this, he also revels in the downfall of Desdemona, innocent of any possible wrongdoing towards Iago and for whom he cares nothing - enjoying watching her pure repuation turn 'to pitch'. He is relentless and remorseless. We may correctly label him a sociopath, psychopath, mysoginist and misanthropist. I find no redeeming qualities!
Iago, to me, is one of Shakespeare's most entertaining villains. He fits the definition of a villain--someone who is nefarious and evil--and he has no redeeming qualities. Even at the play's end, when his wife and alleged friend are dead because of him and his plot is ruined, he shows no remorse for his actions and refuses to give an explanation for them. He tells a distraught Othello,
"Demand me nothing. What you know, you know. / From this time forth I never will speak word" (5.2.316-317).
The only possible argument that one could offer for Iago's not being a villain is if he or she considers Iago to be a psychopath. However, to me, a psychopath spends long periods of time, even years, plotting with the hope that he will not be caught. That seems to imply that the person knows that what he is doing is wrong and simply doesn't care, and that could describe many literary villains, including Iago.
i believe iago is not the villian, but society is.