Arelith

Would the people of Faurun have an understanding of the Pact Primeval roughly equivalent to medieval christianity 'the flesh is sinful' etc?

The Pact Primeval is a very esoteric and obscure subject that only those scholars very well versed in planar history and infernal lore might have come across. It's unlikely to have any appreciable effect on popular culture or the understanding of such general subjects as sin and punishment.

That's in contrast with, for example, the Wall of the Faithless, the likeness of which can be found in every Kelemvorite temple in every major city and town in Faerun.