okay ... I'm confused here. Great description but I know nothing whatsoever of these empires and other stuff in Rifts.

The Coalition States are the primary antagonists of Rifts North America and my favorite subject. They're the direct descendants of the United States, only they've embraced the socialist ideals from Adolf Hitler, and have declared an all out war against anything inhuman or not man-made. They've adopted the motif of Death as their symbol, and they are greatly feared by all who've fought against them and their forces of Dead Boys, Skelebots, Death Head Transports, Skull Walkers, Dog Boys, Nekos, Ursa-Warriors, Monkey Boys, and more!

The Federation of Magic is one of several factions in the central parts of North America that have embraced and promote the wide use of magic. They could be considered one of the good guys fighting the Coalition or as one of the many notorious villains that are a disgrace to humanity. They are lead by Lord Duscon, self-proclaimed King of the Federation of Magic, who rules from the City of Brass. Amongst his council includes a Lion man named Lord Rakhasha, as a fun little fact.

The Federation of Magic and Coaltion States are mortal enemies, if you haven't already guess. :P

ah. okay; and what exactly is a mind melter? Someone who keeps magical beings from using magic?

No no. It's a rather cruel way of putting it. Mindmelters are the psionic counterpart of the standard wizard. Their psionic affinity allows them to control even the super psionics such as pyrokinesis. The only other psychic being who could properly stand up to a mind melter are the Achilles Republic Neo-Humans.

ah. So in the case of this mind melter, they're using him in an experiment to create an even better soldier for the coalition states?

Yes, that's about right. Normally, Darkhounds were Coalition Dog Boys who had been twisted into monsters by magical experimentation. Lord Duscon had hoped these Darkhounds could be used against the Coalition States, but it turned out that the experimentations enhanced the Darkhounds anti-magic predatory nature--thus, it began to feed on the people they were created to protect. As such, a lot of the truth behind the experiments has been brushed under the table and Darkhounds have been labelled as D-Bees, which is far from the truth of things.

Desmond Bradford, however, knows of the true origins of Darkhounds and so he hopes to create a Darkhound from a human test subject in the hopes of creating a much smarter and more cunning monster to serve the Coalition.

wow, scary. What do you think will happen to this guy?

Well, he escaped, of course. He'll probably run into a coalition patrol and follow them closely behind, having some bonds still with them. They've been known to rescue human children and shielding former allies from harm; in fact, it's often considered good luck to have a Dark Hound following a Coalition Patrol.

but wasn't it the coalition that did that to him in the first place?

Yes, but there's dog boy genetics in him too now, stuff that forces him to submit in ways that doesn't involve actual grovelling.

ah. So he follows it because he's a loyal pooch now, but still wild enough to not openly serve the man responsible for his change.

Yep! That's about right!