I'm reasonably confident that the Catholic Church 16 knows that Hell is real.
1) Let's assume that RCC isn't evil.
1b) Let's further assume that RCC is, in fact, a broadly good-aligned organization, whose leadership really desire to save the souls of their flock / help people to find salvation.
2) Given: Purgatory isn't real.
3) Given: Souls in hell can be destroyed over relatively short periods of time
4) Given: souls can be corrupted forcefully beyond their ability to resist via force of will / faith alone.
5) Conclusion 1: RCC's knowledge of demonic and the nature of hell and afterlife are incomplete at best, with several tenets being factually wrong. Assuming 1, RCC should at least not be against Paul correcting the knowledge deficiency of their flock. Assuming 1b, when given the information, RCC should start to actively correct the factually wrong parts of their religion that actively harm their followers withing the paradigm of christian faith.
6) Given: Satanus, basically a pagan deity turned demon, took over hell after First of the Fallen, the closest thing to Satan, and Lucifer Morningstar were out of the picture.
7) Given: Satanus is in cahoots with several mortal supervillains, and is actively upteching hell in what looks like preparation to invasion of Earth or Silver City.
8) Conclusion 2: Based on 6, Hell of Satanus is no more christian hell than Hel of Norse religions or Hades are. This is something that needs to be conveyed to the flock.
9) Conclusion 3: Assuming 1 and 1b, it's a duty of the church, if given the opportunity, to go and kick demonic teeth in. At the very least this should include excommunicating / cursing any and all persons involved with the Light at any capacity. Also, likely a restart of inquisition, officially I mean. Also, well, Hell is preparing to invade. It is the duty of the church to protect people from the forces of hell. They need to prepare for war.
EDIT: Basically the same thing can be said about any major religious institution.