In my interpretation, the message of the fight between Simo Hayha and Loki is responsibility, specifically responsibility for one's own actions, where both Simo and Loki are opposites.
Both Simo and Loki share the fact that they both did horrible things and hate themselves for everything they've done:
Simo has killed many people and always remembers the deaths he caused during the war, and the fact that for his Volundr to work he has to sacrifice his organs represents Simo's guilt, since Simo feels the pain he causes his targets as a form of self-punishment for taking the lives of others.
Loki was driven by jealousy of Siegfried and desperation to avoid losing Brunhilde, which led him to frame Siegfried for a crime he didn't commit and unwittingly he facilitated Odin's plans which leads to Siegfried's imprisonment. This nearly destroyed Loki's friendship with Brunhilde, and Brunhilde decided to participate in the tournament in an attempt to save Siegfried.
The difference is that Simo doesn't justify himself in the context of the war, but rather takes responsibility for his actions and seeks to "redeem" himself by sacrificing his organs and fighting for humanity. Loki never takes responsibility for what he did; he fights under the false guise of a jester and joker because deep down, Loki knows that everything that happened is his fault and hates himself for it but instead of taking responsibility for his actions, he only unleashes his wrath on others.
That's why Simo won because Simo accepted responsibility for his actions, while Loki chose to play the victim and harm Brunhilde by trying to undermine her plans for Simo to win the fight.
