How had Paul already decided to deal with the sin in 1 Corinthians 5?

Paul had already judged the matter and made up his mind to deliver the guilty man to Satan. This was to be done when the congregation gathered in the name and power of the Lord Jesus Christ, not for the destruction of the soul, but for the destruction of the flesh.

Les explains that Paul had judged or made up his mind already how to deal with this, as though he were present, concerning him that had done this deed. Paul admonishes the congregation to act in the Name of the Lord Jesus Christ, when gathered together as a congregation, and with the power of the Lord Jesus Christ, to deliver such a guilty man unto Satan. The purpose was not the destruction of his soul but the destruction of the flesh.

1 Corinthians 5:3

For I verily, as absent in body, but present in spirit, have judged already, as though I were present, concerning him that hath so done this deed,

Did Paul say the Corinthian church had to deal with the sin in their midst?

Yes. Paul concluded that the Corinthian church could not ignore the gross immorality in its midst. Even though absent in body, he judged the matter already and insisted they had to deal with it. The church was to confront the offending couple as a body of believers gathered in the name of the Lord Jesus.