Ouyang Huanyu was most distressed about losing an experimental body like Shen Yanxiao. It meant he lost the only soul of the War God, so no matter what he did in the future, it was impossible for him to create an existence like Shen Yanxiao.
Ouyang Huanyu agreed to hand Shen Yanxiao over to Satan because Xiu had woken up. With his strength, it would be difficult to capture Shen Yanxiao. Since he could not get Shen Yanxiao back, he had to shift his attention to the soul of the War God. Although handing Shen Yanxiao over to Satan was something Ouyang Huanyu was very unwilling to do, if Satan was unwilling to take action, he feared that he would not never be able to integrate the bloodline of the eight races in the future.
After weighing the pros and cons, Ouyang Huanyu made such an agreement with Satan.