As a principle, a common muslim is under no obligation to explain and justify his position when he encounters an apparently disturbing hadith.

(See: Discussion 58280 • Reply 58283 AND Discussion 58280 • Reply 80065)

It is called ilm-ul-Khasa for a reason, which only scholars are bound to gain and understand. For a common muslim, Quran and Sunnah are enough for him to spend his life in accordance with Islam. In words of Imam Shafi:

وعلم الخاصة سنة من خبر الخاصة يعرفها العلماء ولم يكلفها غيرهم وهي موجودة فيهم أو في بعضهم بصدق الخاص المخبر عن رَسُوْلَ اللّٰہِ بها وهذا اللازم لأهل العلم أن يصيروا إليه

“And the knowledge of the select is the sunnah which is acquired through their reports, which the scholars know and which is not essential for the common man to know. This sunnah is present with all the scholars or with some of them from God’s Messenger (sws) through the information provided by a reliable informant and this is the knowledge which scholars must necessarily turn to“.

(Abu Abdullah Muhammad ibn Idris al-Shafii, Al-Risalah, 1st ed. (Beirut: Dar al-fikr, n.d.), 478.)

Ibn-e-Abdul Bar has written in his book that religious status of person negating the first part of Sunnah (ijma and Tawatur) will be judged, but the second part of Sunnah (akhbar-i-ahad) is only proof to act on certain matters, it is not a matter of belief in itself.

(See for reference: Discussion 69585 • Reply 69886)

One cannot stop people from labelling them, but one’s attitude towards these queries should always be epistemological. One should first develop understanding of what is hadith, its mode of transmission, the inherent problems which arise because of their mode of transmission, how do they effect a common Muslim who is not a scholar, what are his responsibilities in this regard and what does our classical scholars say about this knowledge.

Following link contains all the details necessary to understand the nature Hadith Corpus:

Discussion 66135 • Reply 66162

Majority of Ahadith, after deliberation, can be interpreted rationally after applying the principles of understanding Hadith, developed by Hadith Scholars themselves.

The best way to answer such queries is to either first clarify and explain the status of hadith corpus and then give your interpretation of Hadith or first give your own interpretation and then explain the epistemological status of hadith corpus.

This hadith is not new, scholars have tried to explain this narration in different ways. Some have called this relating to matters of unseen world (how satan/Jinns interacts with us), while some have called the use of word Satan as a metaphor to the impurity that we find in our nose after we wake up etc. etc. (For example: https://abdurrahman.org/2011/08/29/know-your-enemy-shaytaan-spends-the-night-in-your-nose/)

The bottom line is that religion requires purification, of which purification of body is an integral part and keeping this in mind, cleaning of the nose, the mouth and the teeth has been initiated as separate Sunnah by the Prophet (sws) under ‘Customs and Etiquettes‘ and the same is encouraged in several narrations through different wordings. In the same spirit, Prophet Muhammad (sws) also encouraged washing of hands after waking up (e.g. https://sunnah.com/bukhari:162). This narration also belongs to the same category.