Farquad and his nonmagical people are the reactionary sellers, Pinocchio and the little pigs are the the indigenous magical folks who are subject to forced deportation. Shrek is also an indigenous magical person who is class traitor and collaborator with the settlers, working for Farquad to remove magical immigrants from his swamp and serve Farquad’s interests in legitimizing himself as ruler despite being a settler.

Shrek didn’t switch sides out of ideology but out of self-interest.