From my understanding:
there is main system that is called the Dao of Heaven: it's what controls everything in the plots and deletes bugs.
Yi used to be a system called Y that contracted with the original Qi Xian (the soldier).Qi became the sorcerer that attempted to turn Y into a person to continue their love affair. In the process, Qi seems to have been targeted by the Dao of Heaven along with Yi, who ended up becoming a person. But this does explain his psychopathy as he literally doesn't understand emotions. Qi was torn apart and his soul scattered amongst the different novels, thus forming all the different versions of Qi that Yi encounters. The merman plot seemed to be last piece they needed to be able to regain Qi's soul. SO was Y's understudy as a system. Y and Qi's disastrous love affair is why the systems are no longer allowed to appear to human, as they bond too easily with their hosts.
SO is essentially Y's son so he's trying to protect them both from the Dao's notice until they both have healed and can reunite properly.
Might have missed a few things but i can try to explain better lol.
This is getting really confusing. Somehow, everyone is regaining memories of past lives and there's 5 different versions of Qi Xian? Also, we are getting like 0.2% of the whole Y thing explained and the rest is supposed to be figured out by ourself? Who the f is main system?