I have 3 azure damsels and 2 Talbot damsels in a 5 foot 137 gallon peninsula. They are territorial and will occasionally chase each other very briefly but as long as they have enough room they are fine. The horror stories people parrot come from throwing multiple damsels in ten or twenty gallons and expecting it to be fine. The damsels themselves also matter generally damsels in the genus chrysiptera are what you're looking for.
Like anything there’s no one answer. Damselfish are a huge group of fish that includes Clowns and Chromis. Some species are fiercely territorial and need lots of space, to the point of being mean as hell to unrelated tank mates. Others can be kept in small groups, they often pair easily like their clownfish cousins. As above the Chrysiptera ones are usually pretty good with the exclusion of C.Cyanea.
Normally as long as you have enough rock with hiding spaces they will be ok. They defend their small area....sometimes to the death. I have a couple of Azure damsels which are some of the safer ones and they will still chase each other away if they get to close.