Daniel is not special. He's a privileged man social class & wealth-wise, yes, but he's an ordinary guy with relatively ordinary woes. The only thing that makes him different is his accidentally getting tangled up in something that was never meant for him in the first place.
I agree with the interpretation that Daniel is the real villain (or at least one of them) in Amnesia. There are lots of people who also read him as the 'ultimate' evil, someone extraordinarily warped in ways that 'normal' people could never become. This, however, I disagree with. He is shown to have biased views and opinions typical for his era and upbringing, something a modern person could (and should) consider alarming in our day and age, but still, his flaws before Brennenburg are palpable, but not exactly out of the ordinary. He's just some dude.
His mental state deteriorates rapidly, and by the time he reaches Brennenburg, he's delusional, paranoid, jumps at the shadows and, rather justifiably considering what little evidence he has at the moment, now fully fearful for his life. As someone who's struggled with extended periods of intense insomnia and high anxiety fuelling each other, his willingness to accept help - any help at all - is sad, but logical. Your mind does not work properly in that state, you're no longer capable of thinking critically the way a healthy human is supposed to.
His escalating into atrocities is still meant to be horrifying, because it is. No excuses. But I do not think him unusual or extraordinary in that matter. On the contrary, I think it gets underneath your skin because of how he could be literally anyone. To me, the real horror of Amnesia is realising that Daniel represents the ordinary man - that it's not only extraordinarily wicked people who have always been wicked who are the only ones capable of committing horrible deeds. He could be anyone. He could be you or me.
Circumstances do not excuse his actions. His failings are still his, and he fails to own up to them. But ultimately, his downfall doesn't strike me as 'special'. If anything it's human - uncomfortably, relatably human, in ways that we're not ready to see in ourselves. Daniel is an ordinary man, but is he also meant to be the embodiment of the 'ultimate' evil? If so, then I think it goes without saying that the ultimate evil isn't something beyond our comprehension, but something that we all are.
The seeds of ultimate evil are sown in the common man. In you and I, in everyone around us. It doesn't take unusual wickedness or unusual cruelty. All it takes is an ordinary person, at the wrong place, at the wrong time, with the wrong circumstances. Personally, I think Daniel himself confirms my theory by trying to shift the blame to Alexander: "it's not me, it's him. I'm not evil, it's someone else." Just like the players at the controls. "In Daniel's shoes I'd never, it's just Daniel being an unusually evil person."
I think this is fully intentional. By forcing the player into Daniel's POV you are viewing things from his perspective, while you try to distance yourself from him emotionally by saying you'd never, that you'd be better. But would you really, if you were in his shoes?