I'll give my two cents
1) Hes still in the first realm I guess but he loops alongside us? or maybe we all start the loop at the same time. He was keenly aware of the impact of Wrath on us and gave some cryptic hints before the energy backlash warped the player.
2) Collision of Tribulation Wrath by the heavens and the player's seed influenced core having a backlash. Teamaster seems aware of the result of the energies so it suggests that the event isn't random or teamaster has undergone it himself in his own loop story.
3) I only did 1.2 before going back to Act I but I think the miasma helps temper the player's understanding of what energy is in different forms and how to convert a certain dimension's energy to use what they had developed. Soul forging allows the player to wield expressions of aspects of energy with them as they loop so we go from having a seed with an essentially naked player to one that has essence of apex beasts from wilderness to one that has harnessed aspects of this miasma energy and can don it through incarnations. I'll have to do the rest of 1.2.1 and 1.2.2 to expand on this but I think this arc is basically helping the player learn how to step away from the structured understanding we had of the world's energy and develop our own structures. This comes in the form of soul forged equipment and using miasma for qi