Probably not correct but I think a fun answer.
Outcast, always alone at the end of the games we play
Sauron tries to attack the Free Peoples of Middle Earth multiple times and each time he is defeated and banished (outcast) for a time.
Beauty, defies me and leads to my demise
He is defeated by elves, described to be a beautiful race. You could also say he is destroyed by the beauty of Frodo and Sam's freindship which allows them to persevere until the Ring is destroyed.
Jagged, the structure in which I stay
Sauron resides in Dol Guldur and then later in Barad-dûr, both jagged structures.
Fire, surrounds me its warmth I use as a disguise
Sauron projects a flaming lidless eye above his tower. Many think the eye is Sauron himself but the books never actually say that it is.
Restless, even in death I return
Sauron has been defeated multiple times. Each time his spirit is banished for a while but returns after gaining strength. At least until the Ring is destroyed.
Expendable, are the pawns I send forward to stop you
Sauron's main forces are orcs which come in large hordes and are very expendable.