The root of the problem is that "the thing that points to an entity" is not a consistent concept in this kind list. Sometimes it's "head", sometimes it's an entity's ->next. I wonder what Linus would think of implementing the linked list with a dummy head node, having no value and pointing to the first entity. Personally, I think that would be tasteful. It allows for simple loops like the "good taste" one, but you don't have to think so hard about how to implement a simple operation like remove. You don't need the added indirection.
Depends on where you store it. If you're just passing around node pointers, then you could create the dummy node on the stack only when you need it and it's the same indirection cost as the "indirect" pointer. If you've got a "list" struct that you're passing around (pretty unlikely in C), you could embed the dummy node directly.
