Honestly, while I don’t like Damian at all, I don’t think turning him into a villain would fix him. It just subverts what little interesting character development he’s actually had, and necessarily requires him to be even more of a jerk than he was even when he was first introduced. He’d still be around and more obnoxious than ever, we’d all still hate him, and his fans would be equally annoyed. No one’s happy.
Killing him would be efficient, but they tried that and it was a trainwreck. Not the best thing to repeat.
Developing him to a point where he’s not obnoxious is normally the best solution to this kind of issue, but that won’t work either, because the problems with Damian as a character are so fundamental that “fixing” them all would just be creating a new character who’s not Damian. As long as he’s around, he’s always going to be the snotty, entitled, self-important, super-special son of Batman who gets to do cool things because of who his daddy is. That’s the entire premise of the character.
So, that leaves one thing: Just stop using him in stuff and let him fade into the background naturally. Obviously his fans wouldn’t like that, and I respect that opinion, but personally I believe that if Damian just goes away, the franchise will be improved by his absence.