Who goes to hell? A video response.
"If you're evil and die you start off your next life as a flesh fat monster and progress up the ranks. What happens if you're good, and does anyone ever just die and end up in their gods realm ?"

So back when the devils came to be, the supernatural beings were less focused on good and evil, rather, they were very focused on the relative worth of law and chaos.
In the matter of Devils versus Demons, for instance, it is two evil factions, one lawful, one chaotic, and the blood war was largely about determining the brute superiority of one or the other, but, due to Asmodeous' deal with the gods, it was perpetuated far, far longer than it ever would have been, due to it gaining Asmodeous the right to take souls who were to be punished.
Eventually, Asmodeous consolidated his power, absorbed the divine essence of the God Azuth and probably has less need for the souls contained in his realm, but, back to the question.

Not all evil people automatically go to the nine hells when they die, in fact, many don't. A person who was evil in life and worshipped an evil god, would go to the domain of that god after death. Those who proclaim themselves as good, but really lead a life of evil, are the ones who go to hell. See, they have broken promises, they have lied, they have presented themselves as servants of the light, and the gods, good and evil, have decreed that this breaks the law.
If a person is doing evil out of service to an evil god, that god is bound by divine law to take on those souls, and the power they grant.
Why are souls so valuable to deities, you might ask?
Well, much like a person who is floating in limbo and decides which direction is up and which is down, or the Githzerai who can stabilize the chaos just by disciplined concentration, the power of a soul is to observe and influence reality. Gods need the power to manipulate reality on a vast scale, and they need the focus of souls to do it, though it is enough that the souls have given agency to the god, by simply believing that the god can do mighty things.
I imagine it is pretty complicated, but that is the power of a soul in a nut shell.. they are the batteries of creation, and they never run out of juice as long as they can focus on something, and interact.
There is no point storing souls in a void, as the soul can't function and will just go bat shit crazy, or go catatonic and just shut down, so, gods create realms that satisfy those souls with a subjective reality in tune with what that god is all about.

So, those who have broken the law, have lied, victimized and acted out of self interest, who have denied the agency of the gods and sought supernatural power for themselves.. they are the ones who go to the nine hells, and the devils make deals, influence, coerce and swindle mortals into breaking that law as often as they can.. the mortal have the power to say no, even if it would result in their death, they can deny the devils and just obey divine law, so a devil is reluctant to up and murder a mortal who is refusing to make a deal, thus, they do their homework, take their time, set all the parts in motion and create the illusion that the mortal has no other choice, when in reality, death and transportation to their god's domain is infinitely more preferable to condemnation to the Nine Hells.
Most who wind up in the nine hells are stripped of all self awareness and memory, incarnating as a wretched Lemure, to face eons of torture, savagery, abuse and depravation, including being torn apart and eaten by demons, over and over again.. some will never know any other fate.
Those who show promise though, might begin the long and precarious climb up the rigid heirarchy of the nine hells, because this is, after all, a place of absolute law, as inexorable as the world cogs of Mechanus, just far, far more brutal and cruel. The only joys to be had in hell, is satisfaction at the misfortunes of others, and absolute servitude from those beneath you, and I suppose, knowing that if you have the law on your side, you really do have the upper hand.

I guess the take away message is that, it pays to give the gods their due, in D&D, and it matters less that you are good or evil, as long as you basically own it and be consistent, you can even be the perfect example of lawful evil and steer clear of the Nine Hells, just make the offerings to bane and observe his rules, and you are good to go.
You present yourself as a follower of Torm, and go around breaking laws in secret, doing dirty deeds, and you are buying an express ticket to Avernus!

I hope that does a little to clear that up, and I welcome any comments you might have, on this topic or any others that crop up as we talk about D&D monsters, realms and ecologies.