I don't have time to do this justice rn, but I don't entirely agree with your read of the ending. The deserter's inability to see the phasmid wasn't whatsoever the product of his devotion and fanaticism; it was, as we're explicitly told, the product of having been in the phasmid's environment for a long period of time. Exposure to the phasmid's neurotoxin is what prevents seeing it; only those who have just encountered it can countenance it. Sometimes it takes fresh eyes.
I also don't think the deserter's devotion to communism destroyed him. On the contrary: The project of communist revolution was destroyed and gutted, forcing the deserter into a shadow of a life. Even in that half-life, though, he was able to maintain the communist project—to continue fighting a war that no one else knew they were still fighting. Specifically because he'd been relegated to this subaltern position, specifically because he was forced out of active conflict into spectatorship, he was able to watch the city, to understand where its flows congealed and its power moved—and then to do something about it.
He isn't by any means an exemplary figure, and the game undermines the authority and rectitude of both his political project and his personal outlook in a number of ways. It is worth emphasizing, though, that with a single 'critique', he creates a vacuum in Martinaise—one that singlehandedly occasions an enormous amount of political upheaval and is, in its way, responsible for every bit of good that Harry does throughout the course of the game. Again, this is not by any means a tidy bit of optimism to close the game out with—I think the Phasmid conversation, and the conversation with Harry's department, do a
lot to contextualize the deserter's actions—but the deserter is far from the game's most impotent or pitiable figure.