The Draculoids are low level Better Living Industries grunts who also serve under the S/C/A/R/E/C/R/O/Ws. When not being used by the scarecrows to "clean the desert" of Zoner presence, Draculoids are used by BLI/nd to punish those who don't comply to their laws and regulations.
When a Draculoid mask is put on someone they become a Drac in a process called Draculoidization, which erases personality, potentially erases memories, and removes the soul from their bodies. This is done to prisoners and detainees that are deemed suitable to become BLI/nd employees. This can also be used to "downgrade" higher ranking officials like scarecrows, who retain personal agency compared to Draculoids. According to Dr. Death Defying's banter during his transmission CD release party special, some of them are his former war buddies who were forced to become Dracs.
Draculoids have different vision compared to a regular human; they only see in black and white and other humans are viewed as giant ticks.