Foul Play inflicts damage. It uses the target's Attack stat to calculate damage, as opposed to the user's Attack stat. The target's stat boosts (Abilities like Huge Power plus anything that changes the stat stage, such as Swords Dance or Growl) are incorporated into the damage calculations. Any remaining boosts (such as STAB, being burned, Abilities like Adaptability or Tinted Lens, and items like Choice Band or BlackGlasses) are calculated with the user of Foul Play's items, Abilities, and status.
So yes, items and abilities do affect Foul play's damage