Not Justified but saved. We are saved by grace through faith ... to do good works Ephesians 2:8-10
It winds up being the same thing. Because of the golden chain of salvation (
ordo salutis), all those who are justified will be adopted, sanctified, and glorified (finally saved). God is a just God. If someone is justified, he will be glorified. On the other hand, if someone is never justified, they can never be glorified. Again, it would be unjust of God to do so. So the set of all people who are or will be justified and the set of all people who are or will be glorified are precisely the same set.
James is right because faith is not alone among the faithful. Faith is alone in the demons who "believe (have faith) and tremble. James 2:19.
I don't think I would use the word "faith" in quite the same way. The demons have no element of "trust" in their belief. They have some knowledge, but little to no assent, and certainly no trust. It's very far from a believing faith.
The works that Justify...
I'm assuming you mean "justify before other men"?
...are the works of grace that are born of a lively faith. Thus one is truly saved by grace through faith which is given to the faithful...
When someone is initially given faith, that person is not, at that moment, already a faithful person. Far from it: that person is lawless, a covenant-breaker. The biblical picture here is that that person is a dead man. Dead men don't do things. They have to be resurrected first.
... so that they may do good works. One cannot rightly divide the word of truth without understanding that the one essential for salvation is grace.
I'd agree with that.
A lot of this discussion boils down to the distinction (but not separation) between justification and sanctification.
Justification is an act of God’s free grace unto sinners, in which he pardoneth all their sins, accepteth and accounteth their persons righteous in his sight; not for any thing wrought in them, or done by them, but only for the perfect obedience and full satisfaction of Christ, by God imputed to them, and received by faith alone. - Westminster Larger Catechism (WLC) Answer 70.
Sanctification is a work of God’s grace, whereby they whom God hath, before the foundation of the world, chosen to be holy, are in time, through the powerful operation of his Spirit applying the death and resurrection of Christ unto them, renewed in their whole man after the image of God; having the seeds of repentance unto life, and all other saving graces, put into their hearts, and those graces so stirred up, increased, and strengthened, as that they more and more die unto sin, and rise unto newness of life. - WLC Answer 75.
This is a very careful and important distinction. Any good works we ever do have
nothing whatsoever to do with our justification. We simply cannot contribute to our justification. Sanctification, which always follows justification, is another story. We work at our sanctification, and God works in it. It's both, not just one or the other. We are utterly dependent on God's strength to do good works -
and we must do them.