To My knowledge there isnt any WOJ on how it would work in the novels, other than one that says anyone of Mab's level could rip the Hunger right out without much effort, but that it do some serious damage.
If it were my game, Id use it as a chance to play out one of my long-time hopes, which is that the Sword would not Destroy the Hunger Demon, it would "reform" it (in the judicial sense), helping
Thomas the Wampire character to learn how to feed on (and incite) more positive/benevolent emotions like Courage or Empathy or Perseverance or something. Per WOJ a Wampire Hunger can learn to feed off /any/ strong emotion up to and including Puppy-induced Cuteness overload.
I would not assume that RCV/WCV work the same in this way. I'm not saying that they DO NOT do so, just that I wouldn't assume it. I keep falling into the "vampires are vampires" mind-trap, but they aren't the same!
I don't think canon or WoJ has info sufficient to decide the question, so it boils down to what "feels right" for your game...
My understanding is that the Knights & Swords are about the Denarians, so I'm disinclined to use them to MagicBullet a WCV's demon away; OTOH, a Sword gave Murphy KotC status in fighting RCV's & we know Michael rescued Charity from a dragon, so they DO sometimes act outside the Denarian remit (I blame ineffability).
I think a selfless WCV could use a Sword to do the Knightly work. It would probably be more a mark of that WCV's ability to master their Demon, than it would act to destroy/bind/etc the Demon...
YMMV
They seem to be able to Defend the Innocent against Supernatural Threats regardless of whether the events are directly connected to the Denarians; I strongly suspect the Balance of those two is more esoteric than literal. Otherwise I'd expect the Knights (especially Sanya) to wonder how cases like Siriothrax or Agatha Hagglethorn connect to the Denarians.
At one point in GP Thomas was burned by the touch of Amoracchius, though the argument could be made that he was reacting to a powerful Artfact of Love, rather than the reaction to Faith that Blamps and Ramps have. Given that Susan has been burned at times but not at others, I'd be comfortable with the idea that the Sword itself (or the sword's Management) can prevent it from running afoul of it's wielder's vulnerabilities regardless of what they are, whether they are harmed by items of Love, of Faith-magic, or even of Iron.
Again taking cues from what didn't happen at the Red Court ball, I don't think this is necessary.
Anyone can pick up and use the Sword (as though it were a simple sword if nothing else) for any purpose, no matter how foul.
I dont think that is the case, at least based on the events of GP. Anyone/Anything can touch the sword and use it for foul purposes, but
only after it has been made vulnerable via mis-use by someone properly entrusted with it; in GP Michael handed it to Harry to hold (implicitly entrusting him with it) at which point Harry screwed the pooch by misuing it against Lea. Lea said specifically that she'd have been unable to touch it otherwise. In other words the monsters cannot just knock the knight unconscious to steal and destroy the sword.