I agree with you on some of what you say about covenants. The whole early church believe Jesus came to "fill up" the old covenant. That left a lot of room for figurative interpretation, and for suggesting things were misunderstood and wrong. For example, they said sacrifices were something God didn't need. They were added just to pull the Israelites' carnal minds back to God on a regular basis, and food laws were understood to mean that Christians are to fellowship with those who ruminate on the Word of God and separate from the world.
However, the idea that the covenant passed from the Israelites to the Gentiles has a pretty solid basis in history and Scripture. Jesus told the Pharisees that God would take the kingdom of God away from them and give it to a nation more worthy.
I'm not sure how this makes Abraham, Isaac, and Jacob suddenly unsaved.
Paul definitely believed the Law couldn't be kept by unredeemed man--at least in general. The offering of Christ was to provide the Spirit for all followers of the new covenant--call it renewed if you want, bu the result is the same--which followers of the old covenant did not have.
That Spirit and the accompanying grace are so that the righteous requirement of the Law will be fulfilled in those who walk by the Spirit rather than attempting to follow the Law on their own.
Whether you call that a renewed or a new covenant, that's different than what was happening in old Israel.
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