In the afterword of book 1, author Stephen R. Donaldson commented that he wrote the novella because he wanted to take the classic character triangle of hero, victim, and villain and have his characters switch roles as the story progressed. For book 2, apparently he decided that everyone should be both a victim and a villain and to hell with anyone being a hero. This book picks up right after the events of The Real Story and continues to follow all three lead characters: Morn Hyland, Nick Succorso, and Angus Thermopylae. Angus is in custody for a crime he didn't commit and undergoing torture at the hands of the UMCP. Morn has essentially gone from being a captive on Angus' ship to being a captive on Nick's ship but this time she possesses the control for her zone implant, which she must keep secret at all costs. And finally, Nick Succorso shows his true colors and begins to unveil his evil plans for profiting from Morn's situation.
Forbidden Knowledge - it's all victims and villains in Gap Cycle #2