Prologue: This is not the end.
All of it for both shows. Do not be fooled by the fact this takes place pre-series for FMA:B/ and before Buffy season three. I reference all the episodes of both shows. Also, throw the first FMA series in, because I snatch minutiae from there when it fits my fancy. Disclaimer:
Hiromu Arakawa, Square Enix, Viz Media and Funimation all own bits of FMA, Joss, Fox and several others own the Buffyverse. The album Sigh No More
and the lyrics it contains is owned by Mumford & Sons and Glassnote Entertainment. I own my allergies and school loans. I'm pretty sure this isn't changing anytime soon. No infringement intended, no profit made.
For a demon to ascend to a higher level it requires an immense amount of energy. Whether it comes from gavroks, blood sacrifice or some other form, the demon wishing to gain ascension must put forth the energy to obtain that transformation.
Contrary to popular belief, the demon Acathla did not want to suck the world into hell, he wanted to ascend to a higher level. He did not want to simply become pure demon. He wished to become an Old One, those demon gods who ruled this realm before the coming of humankind. As one would expect, it takes an incredible amount of energy to obtain godhood, so Acathla's attempted to open a portal to the largest source of energy the magic he employed could sense.
Unfortunately for him, he succeeded.
For a humunculus to ascend to a higher level it requires an immense amount of energy. Whether it be it's own energy or a human sacrifice, anything wishing to obtain ascension must pay sufficient toll to obtain that transformation.
The Dwarf in the Flask Humunculus chose to obtain it's ascension by human sacrifice, for the energy within human souls was the most powerful energy it knew of. It spent years bringing its plan to fruition, prepping the land of Xerxes for sacrifice, sealing the ground with blood and laying the circle it would need to gain what it then saw as ultimate power. All the while masking it in pretty words and false promises to those around it.
When the time came to activate the circle, the creature decided to draw its protégé into the circle with it, splitting the power between itself and Van Hohenheim. As it drew the energy of the thousands of souls of Xerxes into itself and Hohenheim, it felt something attempt to enter the circle. A source of power it had never known before was opening up in front of it at the same time as the Gate of Truth was preparing to obtain Its toll. Eschewing the Truth as unworthy of it, The Dwarf in the Flask tried to pursue the power available from this other source.
Acathla was an arrogant creature. He wished to further himself to rule over the human plane where other demons had failed before him. He had spent centuries planning his ascension, and by the point he had begun the ritual to open the portal to the power source even the brave knight facing him seemed irrelevant.
As Xerxes was being deconstructed into raw energy to create two Philosopher's Stones, Acathla's ritual attempted to harness that power. When he felt the first surge of energy burst forth, the demon reveled in it, basking in his success. Then he felt that energy and more being drawn back out of him.
The Dwarf in the Flask has two anchors on its side of the portal, and while it made sure to draw all the strange new energy it was sensing into itself, those two anchors gave it more control of the reaction. Meanwhile, as he sensed his energy being draw out instead of in, Acathla was attempting to dispel the power he had used to initiate his own ritual.
Acathla succeeded in stopping the flow of his own energy into the portal, but the powers invoked by the Humunculus' circle were still trying to pull the energy from the brave knight and the other humans into itself to fuel the ascension taking place in Xerxes. Finally, the knight managed to overcome his fear and pain to drive his sword into Acathla and the demon's blood interrupted the flow of power needed to keep the portal open. Once Acathla's own energy was sacrificed, the reaction could not be sustained, and the portal was closed until it could be fueled again.
The knight and those he served sealed away the demon, which they could tell had been trying to draw them into a painful hell by the pull on their very souls.
The Dwarf in the Flask cursed the loss of energy to continue fueling its ascension, but it had already begun to plan how to obtain even more. After Hohenheim left, the humunculus set up a circle to capture any further energy released through the gate it had sensed. It infused some of its own energy into the very rocks of Xerxes to create the circle, and later when it would send its children to destroy the evidence of its actions in the ruins, it would make sure this circle remained whole.
All of this work would be futile as long as the demon Acathla remained sealed away. It would take a sacrifice to open the seal and reopen the portal. New blood would break the seal for as long as it flowed on this side of the portal, and the souls of those in this world would simply be energy available to be channeled into the array of Xerxes.
Buffy Summers was horrified when Angelus drew the sword from Acathla, activating the spell sealed into the demon's petrified flesh. As soon as the blood flowed, the portal began to open, and, unseen by Buffy, the array in Xerxes lit up to receive energy. As Buffy fought Angelus, the portal grew and the array began to draw on the vampire's energy. As Buffy drove the vampire back, the pull towards the array grew even stronger, drawing the vampire and his inherent energy towards it.
As the force of the ensouling spell ripped through the vampire, it interrupted the flow of power much like Acathla himself had done centuries before. When Buffy drove the sword through Angel, his blood broke the spell, and as his body was sucked through, there was no more energy available to drive the reaction, and the portal closed.
In Sunnydale, the crisis had been averted, and a heartbroken Slayer was left to deal with the consequences of sending the man she loved to what she believed was hell.
In the ruins of Xerxes, said vampire landed in the middle of an array. It flared briefly, sending a burst of energy through the vampire's unconscious body. Then, bereft of fuel, it faded back into the ground.