consider the rakshasa in 2x02 as an allegory for john.
he's just died, and this episode is about sam and dean's grief, as well as their struggles as they try to move on from his death. the circus itself represents hunters and the hunter society they've just newly discovered (also in this exact episode), and the rakshasa is a monster hiding within that culture of misfits. much of 2x02 is from dean's perspective, and dean has just come to view his father in a violently negative light (consider the end of the episode, where he destroys the impala in order to symbolically hurt john).
so the rakshasa as john. the monster can turn invisible, similar to how john's presence in the narrative is oppressively absent: in season 1 he's missing, and now in season 2 he's dead. yet he's always present in spirit, even though sam and dean can't see him. he's an invisible force weighing down on them, there yet not.
the rakshasa also preys on children. this could be symbolic of the way sam and dean are rather emotionally immature, frozen in time due to the abuse they suffered as kids. indeed when children are featured as guest stars in an episode, they act as allegories for dean (see 1x03 and 1x18). the same thing is true for teenagers, who are typically paralleled with sam (see 1x05 and 1x08)—this present, if sparse, theming could indicate the emotional states of the brothers, or the points in their respective lives which have shaped them most strongly: dean lacks a childhood because he was forced to grow up too fast and therefore imprints on children, and sam is stuck a rebellious teenager, allowed to grow into adolescence due to being sheltered but perhaps stunted in growth as he becomes aware of the world around him and his own situation, and as he develops a lasting resentment toward john. therefore, the invisible monster john winchester is preying on sam and dean, both in their literal childhood and as their present-day selves, trapped in a state of immaturity due to a life of abuse and neglect.
i also like the little detail that the rakshasa lives in squalor, as this can be compared to the motel rooms and the car that sam and dean grew up in: their constant instability and run-down, cheap housing that sheltered them their whole lives. it's a stark difference from the comfort of a stable home, and combined with the nomadic lifestyle of a circus, there is a very striking parallel between the rakshasa's life and the life that john forced his children into.
(an interesting aside, but the rakshasa feeds in 20-30 year cycles, which is quite similar to the cycle azazel appears to be working with to create new generations of special children, which is around 23 years. not sure if this is intentionally drawing a parallel between azazel and john, but i wouldn't be surprised given the tangled-up, impossible web they exist in together.)
in the end, sam is the one who kills the rakshaka, as dean has been immobilized by it (the imagery recalling that of 1x22, where dean is immobilized by an azazel who looks like john; additionally, one can compare the emotional arc dean is suffering at the moment, metaphorically paralyzed by john's final wish and his inability to act on his own because he has spent his whole life a soldier to john's instruction). if the rakshasa is john, then it implies that sam will ultimately be the one to save dean from his conflict, the one to free him of his paralysis—and he does in 2x09, when dean embraces his codependent relationship with his brother, abandons his father, and throws down his gun to choose sam as his guide and moral center. the conflict of croatoan is all about dean finally coming to terms with the choice he's been given and making his decision: sam, above all else. and so sam is the one who saves him and propels him forward into the rest of the season, with his head on straight and his mind clear of distractions. sam above all else, no matter what, no nuance. just like here, where sam frees dean of the rakshasa's literal binding, sam too frees dean of john's emotional binding.