Movies like Veer Zaara, Bajrangi Bhaijan etc did pretty well because they were also in relatively peace times. And then like you said it is the live in angle which may not sit well with certain audience. It would be interesting to see how many people get worked up over this and whats in store for ADHM.
Live in- I think it's who is living with whom that matters. Male audiences everywhere are a bit egotistical and tribal. In Pakistan, the idea of a Pakistani girl with an Indian boy might not do well at this time.
As for India, most successful cross-border romances in India involve an Indian guy and a Pakistani girl. For e.g., Veer Zaara, Gadar etc. I don't see it being a problem here. Fawad's presence might irritate people.
10