Part 2: Mythology
The novelette, Thera Awakening, expends only a page or two on the history of the world of Stonekeep, but its considerably more backstory than the game provides. In the book, Rathe is asked by his adoptive father Orvig what he knows about the gods:
Only what you taught me, what everyone knows, Rathe answered, surprised. That beings called Light and Darkness created the universe. They were the Eldest Gods. When they created Earth, they gave birth to the Youngest Gods, men, Dwarves, everyone. Then they went away.
Little is told of Darkness and Light, though in the last levels of the game, their aspect is mentioned a few times. Orvig continues:
Correct, Orvig said. But what of the Younger Gods?
There are ten, Rathe said impatiently. One for each of the heavenly spheres. Khull-Khuum, who is the sun. Helion, the nearest to its fires. Aquila, the evening star. Thera, that is the Earth. Azrael, who is the red planet. Marif, the world of many moons. Safrinni, the ringed planet. And Yoth-Soggoth and Ko(r)-soggoth, the unseen pair.
This at least confirms that the world of Stonekeep is an alternate version of our own they have the same solar system. The game tends to avoid mentioning that Khull-Khuums aspect is the sun, possibly because it clashes with his dark appearance and use of shadow powers.
You may notice theres one missing: Afri. Its unclear if this is a mistake of the writers or if they just omitted one planet (Dwarves have invented telescopes in this world, but Pluto might have still been beyond their sight), and Afri was added to the game later. I think the books writers at least intended Safrinni to represent Saturn (in the game, he/she represents Uranus), since Saturn is the most obviously ringed planet.
Several of the gods names are borrowed from history or mythology. Thera is the name of a Greek island, Aquila the word for a Roman battle standard, Helion a type of meteoroid that sort of bounces off the sun, and Yoth-Soggoth is of course a borrowed scramble of H.P. Lovecrafts maddening bulk of space-time fungoid, Yog-Sothoth.
Orvig continues by asking Rathe where the gods are now.
The Devastation happened. Rathe said. There was a war among the gods, echoing the war of men. Khull-Khuum, the Shadow King, betrayed his brothers and sisters. Some fought, or tried to escape, but they werent strong enough, and the Shadow King trapped their essences in mystic orbs. Only the goddess Thera did not waste her energy trying to flee or battle him. Instead, she worked her own magick to change his spell. So when they were trapped, the orbs that held them flew from Khull-Khuums grip, and escaped into the heavens. And forever after Rathe paused, and looked Orvig in the eye, forever after, they now orbit the sun, remaining just outside his grasp. All of which every child knows.
This creation myth explaining the planets and their orbit turns out to be true in a literal sense in the game: Khull-Khuum trapped his brothers and sisters in small magical orbs that look like the planets, in an attempt to seize ultimate power. Except that Theras spell didnt send them into the heavens, but seemingly caused the orbs to hide in remote places on the Earth. Khull-Khuum has spent the last thousand years since the Devastation looking for the orbs, with fairly little luck. I guess that during the first centuries, the after effects of the Devastation mightve been so great that even for the Shadowking, it wasnt safe to walk free on Earth. The reason he sinks Stonekeep beneath the earth and reduces everyone in it to bones isnt specified, but I can think of two reasons. One: in the game, Drake finds a scroll with a prophecy foretelling his coming as one of Theras line. Khull-Khuum mightve hoped to assassinate the one mentioned in the prophecy, without knowing his exact identity. Two: Khull-Khuum suspected the presence of the orb of Afri and wanted to send in his minions to find it.
This does beg the question why, in the 10 years Drake spends growing up, Khull-Khuum never bothers collecting the orb. The answer could of course be its a fantasy game, stop trying to make sense of it. I prefer to think, however, that the spell Thera cast is still active, and Khull-Khuum cant easily take possession of the orbs (with some exceptions, like when he captures Thera at the beginning). Maybe the only way, or one of the only ways for him to seize the orbs without them escaping again is for them to be handed over to him by the guy from the prophecy, ie you.
At the time of the game, belief in the young gods has declined, and while when the gods return is a popular saying, few still use it in anything but a figurative sense. Worship of Thera is somewhat rare, as the mother of Rathe (Drakes ancestor) apparently came from another keep to try and convert the folks in Stonekeep. Khull-Khuum still sees worship by his minions, obviously, most notably the Throgs, who know him as Throggi (in the book spelt Throgi).