If for example, a False Demon with the alteration spell of Bring Forth has 2 wounds (which is possible because Bring Forth takes away Illusion from False Demon) and Jessa uses Cut the Strings to discard the Bring Forth alteration from the opponent's False Demon, does that False Demon
A) Become destroyed because of the 2 previous damage it had, because now it has Illusion back,
B) or does it stay alive because those 2 wounds were from an attack while it had Bring Forth attached, but any further wounds will destroy it do to Illusion?
I'm going to say B because when Bring Forth was attached the False Demon 'no longer had the illusion ability'. The ability only triggers when you take damage. It does not trigger as a result of having damage tokens on the unit.
I'm going with B as well. Damage and wounds are very specifically differentiated in the rule book. So as David stated, the WOUND tokens left on the demon do not trigger its demise. Only when it receives damage.
Yup! This is also important for cards like Molten Gold which gives wound tokens. If a False Demon takes 3 wounds from Molten Gold it does not trigger the Illusion ability. In addition, if the False Demon receives damage from anything (Dice Ability, Phoenixborn ability, etc.) other than an attack/counter it does not trigger the Illusion ability.