So, after finishing Episode C, you start building your deck from scratch?
All characters, Flaws, Talents you've got in previous game are gone?
Do I get this right?
Correct (although I think it's episode 2 as the first game is the pilot double episode 1 and episode 2). If you are playing a campaign however, you have a few options you can choose in order to get some bonuses/penalties for your next game.