This train of thought doesn't explain why sin still exists in this world.
You must also keep in mind that this flesh and blood is already condemned:
1 Cor 15:50 Now this I say, brethren, that flesh and blood cannot inherit the kingdom of God; neither doth corruption inherit incorruption.
Gal 5:17 For the flesh lusteth against the Spirit, and the Spirit against the flesh: and these are contrary the one to the other: so that ye cannot do the things that ye would.
As for Jesus parable being a folklore, that idea may have come from here:
http://www.bibleexplained.com/Gospels/Luke/Lu16b.html
At the end of this commentary, the author says this:
In another commentary,
http://www.tidings.org/studies/fables200007.htm , the author of this article quotes a valid point made by someone named, Ron Abel:
I'm sure the Pharisees understood this point very well. I think that is evident in the narration of Luke 16, when Jesus has Abraham saying this to them:
Luke 16:31 And he said unto him, If they hear not Moses and the prophets, neither will they be persuaded, though one rose from the dead.
IMO, Luke 16 doesn't deny or confirm the existence of an eternal hellfire. I'm not saying it doesn't exist, but given the external evidence about the meaning of this parable, I wouldn't use the parable when debating either side of this doctrine.