
It's probably a bit later on in the story because in Jung-Woo's past reincarnations he was a lot stronger than he is now. That's how he was able to be the embodiment of evil and how he was confident about himself and was able to almost succeed. Jung-Woo right now isn't as strong as his past selves so if he were to fight the blondie he would lose by a landslide.

I don't think the blonde dude would know whether or not Jung-Woo is reincarnated. Even if he did know that Jung-Woo was reincarnated he wouldn't be able to tell which body that Jung-Woo reincarnated into, and the blonde dude has to be the good guy so he can't just attack a random person just because of suspicions.

Since MC is no longer a villain I think it would just be friendly rivalry and fight all the time in this reincarnation. There still the life sucking murim person who also reincarnated. It's unlikely for the hero to become villain since he also reincarnated in a good family. Unless the hero was just a pretending one and originally a villain.
When is the f blonde guy who always killed our villain in the past gonna appear?