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In The General's Shadow, I've had a couple of ideas for my antagonist Koslo. Please take a look and tell me which one is more believable. I'm dealing with a few thousand years since the invention of the neuronet, so I want to make sure my technology and human degradation over that time is believable. 
Idea 1: Genetic Manipulation for Warmechs
My original idea for Koslo was that he hijacked the ship and took them to a planet he scoped out for its suitability for human occupation over the long term. He already has a base set up by the time they arrive with subjects who don't realize they are part of an experiment. The experiment is to altar their DNA over generations in order to make their bodies capable of operating the warmechs the Osuna have created. Warmechs are human machine hybrids that he thinks he can improve by starting over with a fresh batch of DNA.
His goal is to create an army capable of taking over the Osuna empire.
 Very science fictionish. I’m not sure that I’ll be extremely helpful since the only science fiction I’m into is Star Wars (thank you Lucas!), but I’ll try my hand at helping.
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a) If it takes multiple generations to achieve his goal, how is he still alive to see its fruition? 
answer i) His body is powered by machines that keep him alive for centuries. 
answer ii) He has created a sleep machine that allows him to wait, but requires his subjects to do the work while he is sleeping. Every seventy seven years he wakes up to check their progress. 
I’d do less of a machine idea and go with scientific study.  The sleep idea intrigues me more, I’d just add a twist… How about he takes some sort of drug derived from plant matter that induces his body to fall into a coma like state.  He can then be injected however many years to reawaken and view progress.  
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 b) How different are the Osuna from the Arakun that would make the Osuna need the Arakun 
I see the Osuna as a product of the neuronet. How would they "evolve" after two millennia of dependence on virtual reality and computers within their bodies? I imagine they would have a different classes and body types:
* large Lower Class to do their work
* Machine Force to achieve efficiency in certain areas of work. 
* Slaves to the upper class. Their job is to nurse the VR upper class just enough so they can stay alive. They are taken care of because they need to be fit and healthy to take good care of their masters. This life is not so bad because of this and they are rewarded with time in their master's section of VR. 
* VR Lifers. These people can afford to have slaves take care of their bodies so they can spend nearly all their time in VR, except for sleep. Food is given intravenously and the slaves work their muscles to avoid bed sores and muscle atrophy. While their brains are sharp, their bodies are practically mush. 
* Military that uses VR for training, but enjoys the thrill of danger they can't experience in VR. They are also proud to be the defenders of their people and are paid well for their services. The DNA they inserted from animal species in order to develop unique traits useful for fighting has created subspecies.
* Earth Walkers are those who utilize the neuronet but only VR for brief training periods. These people look more like Arakun, but the increased computer/flesh adaptation has altered their bodies. At first they looked half machine, but over time they have developed technology that is less obtrusive to their original form. One key giveaway is their threshold for pain is increased beyond what an Arakun would have. 
* VR Junkies are the masses who worked among the earth walkers long enough to afford time in the underground pod facilities where they indulge in VR like drug-addicts. 
* The Simple are the people who just go to VR for business, but live "normal," simple lives in real life. 
Creepy.  Sounds like you’ve covered your bases.
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 c) And in what ways would the Arakun need to be improved?
I'm assuming their minds would need to be developed through genetic therapy to enhance memory, intelligence, endurance, increased visual learning ability to process the images of VR, etc. 
Maybe… So is VR supposed to improve their natural abilities?
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 d) How does Koslo trick people into coming to this planet?
He has his people tell them it is a chance to escape the coming destruction from the Osuna on their people. 
I think that is a good explanation.
Sorry I wasn’t more help, not my area of expertise.