It's been awhile since I've read World Without End, so I can't comment on Follett's portrayal of his characters' understanding of the plague. (Don't get me wrong here--Pillars of the Earth is probably my favorite non-science fiction book--but when it comes to medieval, he tends to get things fairly right or VERY VERY WRONG. Did you know 12th century gilds were modern trade unions? Me neither.)

It's true the Middle Ages had no concept of germ theory. It's also true that a very dominant interpretation of the great mortality was that God was punishing Christians for their sins. As late as the 15th century, medical texts prescribing ways to combat plague include disclaimers advising their readers not to listen to people who say that pestilence is God's wrath and so should not be defended against nor fled from--no, you listen to this author, you buy this book.

But. They absolutely understood that proximity mattered. Our most important source for discussing plague's arrival in Europe, Gabriele de Mussis, writes:

Moreover, one infected man could carry the poison to others [...]

When the sailors reached these places and mixed with the people there, it was as if they had brough evil spirits with them...and their inhabitants, both men and women, died suddenly. And when one person had contracted the illness, he poisoned his whole family even as he fell and died, so that those preparing to bury his body were seized by death in the same way. (Horrox, ed., The Black Death, p. 17 and 19)

Quarantines, sealing off houses with a known sick person (with all the still-healthy people in there, too), fleeing the city (a la Boccaccio's Decameron storytellers)...they understood, all right. Priests' refusal to hear last confession from plague victims was a real problem. Cities passed law after law requiring lower-scale medical practitioners (never the university-trained physicians, of course) to remain in pestilence-stricken cities to treat the sick, because everyone knew you got sick from being around sick people and dead bodies.

In lieu of germ theory, the most common explanation was that sick people and dead bodies poisoned the air around them. Thus people started carrying around strong and nice-smelling spices and flowers to create a buffer zone against "evil air."

Additionally, news of the great mortality traveled ahead of the pandemic itself. The Bishop of Rochester worried himself half to death about the oncoming plague during winter 1348, even though it didn't show up in Kent until the next spring. English archbishops in particular were quite active at arranging penitential processions and organizing local monasteries to say Masses and special prayers in attempt to prevent pestilence from decimating their dioceses.

Proximity mattered, and people knew it.