A quoit can be an iron ring for throwing, a flat dolmen stone or the dolmen itself, according to the dictionary; so a game of quoits encircling the stones, thrown by the devil could be the answer... a good folktale wins over pedantry ;)

Yes, I have always understood the quoits to refer to the stones in the circle inside the henge. One devil threw many quoits, therefore, the devil's quoits.