Well, in the forgotten realms this event was known as the Times of Troubles. Go read up on it, it'll explain at least one of your questions (second one).
The murder of Bhaal happens in the novel Waterdeep, part of the Avatar series.
Cyric doesn't straight up defeat Bhaal, of course. Bhaal's form was already severely battered, which I guess is what the missing arm in the cutscene is trying to convey. Cyric backstabbed Bhaal whilst the god was distracted and injured.
It's important to note that Bhaal was in the form of a human at the time, not the Slayer or Kazgaroth or anything else.
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http://forgottenrealms.wikia.com/wiki/Time_of_Troubles
Cyric doesn't straight up defeat Bhaal, of course. Bhaal's form was already severely battered, which I guess is what the missing arm in the cutscene is trying to convey. Cyric backstabbed Bhaal whilst the god was distracted and injured.
It's important to note that Bhaal was in the form of a human at the time, not the Slayer or Kazgaroth or anything else.