Prosecutors claimed Ivor Bell told a man involved in abducting the Belfast mother-of-ten for being a suspected informer that he had no problem with the shooting of "touts".
Details emerged as Bell, a 77-year-old alleged former IRA commander, was granted bail on a charge of aiding and abetting the murder of Mrs McConville in 1972.
The case against him is based on an interview he allegedly gave to researchers at a US college.
Several former paramilitaries were interviewed about their roles in the Northern Ireland conflict as part of a project undertaken by Boston College.
Although transcripts were not to be published until after the deaths of those who took part, last year a US court ordered that the tapes be handed over to PSNI detectives investigating Mrs McConville's killing.
She was seized by the IRA from her Divis Flats home in west Belfast in 1972, shot dead and then secretly buried.
The court was told on Wednesday that one of the Boston interviewees, given the title Z, spoke about the circumstances surrounding the decision to abduct her. Based on jigsaw identification, prosecution counsel David Russell alleged that this person was Bell.
It was claimed that he detailed a meeting in the kitchen of a house in the Falls Road area with a man seeking advice about Mrs McConville. He was told about her alleged activities as an informer and his advice sought, according to the prosecution.
The alleged consultation took place while she was still alive, Mr Justice Weir was told.
Mr Russell claimed: "He (Bell) indicates that he told the other person: "Well, she's a tout and the fact she's a woman shouldn't save her."
According to the transcripts he may have taken a different view if he had known she had ten children and no husband, the court heard.
However, interviewee Z allegedly confirmed he would back up whatever was decided.
It was claimed that he said he had no problem with shooting touts but disagreed with burying Mrs McConville.
He allegedly stated that informers' bodies should instead be left openly as an example to others.
The 37-year-old victim was ultimately shot in the back of the head and buried 50 miles from her home. She became one of the so-called Disappeared, and it was not until August 2003 that her remains were eventually found on Shelling Hill beach in Co Louth.
Setting out the charge against Bell, Mr Russell said: "The prosecution case is he counselled those who had her in captivity and in doing so he encouraged her murder."
The accused, from Ramoan Gardens in the Andersonstown district of west Belfast, was arrested last week. He denies any role in the abduction or murder of Mrs McConville.
The pensioner, who has serious health problems, told detectives he did not believe he was in Belfast around the time she vanished. Opposing bail due to fears he may flee, the prosecution claimed he had used an alias to travel to Madrid during the 1980s.
Asked how long it could take before the case gets to trial, Mr Russell accepted it was unlikely to be "fast-tracked". He added: "It's clear that there are other inquiries being made, and I don't wish to put it any higher than that."
As relatives of both the accused and victim packed the court, defence counsel Barry Macdonald QC said issues arising from the Boston College transcripts would be dealt with at trial.
He rejected claims that his client may flee if released, pointing to his medical problems.
Granting bail on two sureties of £10,000 each, Mr Justice Weir ordered one to be lodged in cash along with the title deeds to a house.
Bell must report to police three times a week, surrender his passport and give 48 hours notice if he plans to travel outside Northern Ireland.
The judge asked him: "If I release you on bail do you promise me you will keep to your bail conditions?"
Bell, appearing via a video-link with Maghaberry Prison, replied: "You have my word, my lord."