I'm talking about the everyday people, shop keepers, tavern wenches, skooma dealers, for example.

How much would they know about the return of the dragons ie. about Alduin, his role as the World Eater, what they really are, etc?

Alduin? A children's fairy tale told to scare little boys and girls into good behaviour come to horrifying life before their eyes.

Next to nothing. All they'd know would be from folklore and bedtime stories; the legends that say dragons would burn down farms and hoard treasure, and that brave men would hunt these beasts down. But they wouldn't know where dragons come from or what they exactly are. Though legends do talk of an 'Alduin the World-Eater" they most likely think of it as actually eating the world rather than continuing a cycle under Akatosh's command.