The Olde Law is an important mechanic which no one has completely puzzled out, but three basic principles are generally accepted by Scholars:
A Debt owed must be repaid in full, no matter what. Failure to do this results in misfortune.
Magick cannot create something from nothing. Attempts to do so fail spectacularly.
Pacts cannot be violated. This is a simple truth, as anyone who makes a pact literally cannot act against it.
Unfortunately, Mundanes can't form pacts themselves, nor, of course, can they use Magick. A debt owed to a Mundane by a Magickal is regarded as just as sacred as any other debt, but a Mundane cannot be punished by Magick for not repaying one.
In an in-game sense, these three principles take many forms. Misfortune as described by the first principle translates to, roughly, "I get to punish you proportionately to the debt owed." *GM Smiles*
Being Mundane isn't any better or worse than any other race, but the play style is more straightforward. I, personally, recommend Mundane due to a particular perk I put down the line, but each race has an equally Bullshit perk. If you want to be a:
Magnificent Bastard: Play an Infernal.
Murderhobo: Play a Born Mage.
Badass Medic: Play a Celestial.
Fair Folk: Obviously, Fae-Born. This gives you the Blue and Orange Morality Trait.
Badass Normal: Mundane. Later becomes an Empowered Badass Normal if you so choose