The Faye created 'The First Fallen' to fight against the humans that were hunting them.

The First Fallen was strong enough to defeat them mostly on his own.

The Faye did not know how to control The First Fallen.

The First separates from the Faye's order.

The First begins to make his own army, aware that even if he couldn't be killed eventually he'd need an army to overpower the world, but he is unsure of where to begin.

The First is approached by a extremely old Dragon Lord, who had been informed by the Faye of their doings. The Dragon Lord asked The First to make him a Fallen. Thus "The Second" was born.

The First and The Second devise a plan to properly create an army. Defeating and turning people into Fallen as well, two of which being Lava, a mage that had been turned rather early, and Aqua another mage turned later on that liked Lava a lot.

Lava at some point brings up to The First, The Second, and the other "Major Generals" that she was against this. The First ordered her to be killed, The Second said he would handle it. Instead of killing her, The Second imprisoned her to give the illusion of death to The First for a later time.

Aqua discovered Lava's "Death" (Only The Second was aware she was not dead.), and snapped on the First attacking him. The First killed her on the spot.

Fallen vs Non-United World Stuff happens, Fallen Army ruining everything.

The Faye meanwhile had been making "The God Armaments" in order to defeat the Fallen, and informed a certain Dragon Lord of this. Said Dragon Lord unites the world against The Fallen Army.

Before the final battle between the "United World Army" and the "Fallen Army" the first places a portion of his magical essence inside someone, actually aware they would lose the war.

When the war ends, most of the Generals were either killed by The God Armaments, or sealed by the Faye. Note, some of the Generals were simply too strong to be outright killed and so being incapacitated and sealed was all that could be done at the time.

The Dragon Lord leader of the United World Army stabs The First with a God Armament made specially to keep The First completely incapacitated and effectively 'Dead' with the First's magic sealed inside the Armament itself and the first's body pinned somewhere or other.

Then it was determined The God Armaments were too strong to be left in the world for anyone to have. The Faye created magical dungeons around the God Armaments capable of appearing and disappearing at random, as well as one around The First, and coincidentally they accidentally put a God Armament in the location The Second sealed Lava in and thus built a dungeon around her and the armament.

World at peace, blah blah blah. The magic The First put inside the living being passed on through the children of the family line. The magic siphoning the life force and growing stronger before passing on to the next child born, and causing the mother to die during birth. Eventually the magic becomes powerful enough and takes control of a body, and thus creates "The New First" who is searching for the God Armament that has the rest of "The First's Power" sealed inside it.

Aside from that the faye's magics seem to be weakening enough for The Fallen Generals to begin to escape their imprisonment. (Note, This happens officially after 2 Dungeons are cleared. Could be explained as the magic keeping the dungeons in tact is weakened when the armament is removed from the dungeon and it is the same magic keeping the seals in tact.)

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The First/Fallen Generals can kill The First/Fallen Generals
God Armaments can kill some Fallen Generals, and can incapacitate other Fallen Generals.
If a Fallen General does not die by a God Armament then their magic must be sealed inside a God Armament for them to be considered "Dead"
Although, freeing the magic from the God Armament would bring them back to life, or meld their magic with the person freeing it from the Armament.