The passive voice is not ambiguous in English (as opposed to American) The miller WAS hanged, he didn't hang himself (if he did, it would say so).
The fate of the tailor is, however, a bit ambiguous. He might be skipping because of devils chasing him with firebrands or, more likely I think, because he was just too wicked and so became one of the devils favourites as you suggest.
By the way (for Bill) I think that what I was saying wasn't that you need to research anything but that quite a few people would be familiar with the context and that, if you are, it gives the song far more meaning.
Ian Chandler Ashwell Hertfordshire UK