You know, it strikes me that people tend to ignore the existence of deities when they discuss morality and ethics in regards to BG II and the Forgotten Realms.
You probably shouldn't do this. You can't deny the existence of the FR deities, for FR. And so, you can't just leave them out of the picture when you discuss morality, since they no doubt have a say in it. Clerics and the like usually get their moral code direct from the teachings of their respective god. The laws and worldviews of everyone in the Forgotten Realms, or at least in the particular area of the Forgotten Realms in which Baldur's Gate II takes place, are influenced to an enormous degree by the pantheon.
Talos is known as an evil god. He is known as evil even to those who follow him. Lathander is known as good, and seen as good, even by those who are evil. The very existence of the Detect Alignment spell, and those that Detect Evil, Good, and Extreme, means that there has to be a system of absolutes, that relativity does not have much of a place within the Forgotten Realms.
With that said, wearing human flesh is most likely deemed evil because the good deities would deem it so. The evil deities would probably deem it so as well, and then say "go ahead."
So, my personal take? I'm against allowing good-aligned players to finish the armor. Plus, there's that thing with the game already being biased towards a good character (which I have no problems with).
On the other hand, I would very much like an option to, say, dominate, charm, or otherwise convince Fael to spill the beans, then go and brutally slaughter all his comrades. I mean... I don't even get the option to brutally slaughter HIM, unless I force attack. And he tends to run for that inn door, and then promptly disappear. It's rather galling.
Just my take on it.