I think Archie is great personally. He is a very manipulative person. We've seen what he did to Ronnie and Peggy. He wants his own way all the time and is prepared to do anything to get it. I really don't think it matters too much what made him like this. People are as they are. Why is Ian like he is? Why is Max like he is?
As far as wanting the Mitchells, including Peggy, to pay, the reason is because they gave him back the money he had given them to free Sam so that he wouldn't come and stay at the Vic.