Not really. Coil did a lot to improve the city, whether the regular Worm reader wants to admit or not. Additionally, his goal is to remove supervillains from the city and keep it as tightly ordered as possible. He wants to be in control, not to make the world burn around him.
He's definitely an evil sadistic bastard, but he's a neat one. he knows not to creates unecesary suffering. He keeps his torture fetish to discarded timeline, for example, and those are simple phantasms.
On the other hand, there is no way the Avatar would compromise himself like this. Supervillains don't get to do their dirty deeds unchecked because they are useful. Not if the Avatar has anything to say about it.
So if he wants to repent? Getting him a pardon for his past crimes as well as a very cushy job would be on the table. There's room to negotiate with a highly pragmatic individual like Coil. There's simply no way the Avatar could allow to compromise himself by selling out BB to a sadistic supervillain overlord.
It really is. It doesn't have any of the known weaknesses of Precog (it handles blindspots like Scion and Endbringers just fine, isn't bothered by other precogs, none of it). There's really nothing whatsoever that suggest that it doesn't work as advertised.
And what he told The Avatar is more than perfectly possible. It's just the tip of the iceberg. There's much more that can be done with this power.
The problem isn't there. It's that to save Worm you can't start making deals you're going to regret. You can't compromise your core values. The Avatar can't make a precedent of letting villains buying his Official Seal of Approval for their operations. We should probably negotiate with Coil given how amazingly useful he is, but not at the cost of letting him run unchecked.