DISCLAIMER: Certain crucial events are skipped in this amalgam of Eberron lore, due mostly to the fact that Eberron campaigns were written to normally take place in Khorvaire and that DDO takes place on Xen'drik. Hence, such events like The Last War are skipped.
When I judge a game, one of the first things I look for is how good the story is. This is one of the (many) things DDO has done incredibly well. The only caveat is that it is sometimes hard to figure out what the story is; however, this is because the story can be easily ignored by those who aren't interested in immersion, which is a respectable reason. I can handle people skipping all the dialogs in quests, it just made this a bit harder to come up with .
Note: Some of the plot I explain here was received through the use of extrapolation, hints, and guesswork, and so should be taken with a grain of salt. Most of it, however, isn't, particularly the section on the history of Eberron. Enjoy!
The Beginning of Everything
In the beginning, there was only chaos, a mixture of energy and matter in which nothing and everything existed. The rulers of this universe were called the Progenitor Wyrms, and they were the most powerful divine beings to have ever existed. Of the Wyrms, three sisters stood out as the most powerful: Golden Siberys, Gentle Eberron, and Cruel Khyber. Together, these three beings represented the various powers of existence. Siberys was the master of all magics, both arcane and divine. Eberron was the master of life. Khyber was the master of knowledge and darkness. Using their combined talents, the three Progenitor Wyrms fashioned the Draconic Prophecy, a detailed description of the future of all existence. Following this prophecy, the three sisters worked together to create a world out of the churning chaos.
At first, all was well. The Astral Plane was separated from the chaos first, followed by various other astral and elemental planes. However, as these regions were created, the difference between the two more powerful siblings became more and more pronounced. Khyber wanted creation to reflect more mightily on her own views of cruelty and selfishness, and fashioned the planes Kythri, Mabar, and Xoriat. Siberys responded by creating Daanvi, Fernia, and Irian. Eberron, the least of the three sisters, tried to pacify the other two by creating neutral planes. This attempt was unsuccessful, however, as Siberys and Khyber marked the planes that Eberron created to more match their own beliefs, Siberys claiming Thelanis and Khyber claiming Dolurrh.
As the 13 planes were finished, the sisters turned towards creating the center world around which all the other planes would orbit. They began with a simple sphere of rock, crafted from the chaotic matters of the beginning. They then set this sphere on an orbit around a sun, linking the sun to Fernia. Finally, they crafted 13 moons and set them to orbit the nondescript sphere, linking each moon with a plane.
As the sisters turned towards the last piece of creation, Siberys and Khyber began to argue over what the center world should be like. Neither would compromise with the other, and in a fit of rage Khyber lashed out at her sibling, tearing a fatal wound into Golden Siberys' side and scattering her essence across the sky. Eberron, faced with a fight she had no hope of winning, instead embraced her cruel sister and merged with the planet everyone had been fighting over. Taking her own essence, Eberron created life on the planet that she had become a part of. Remembering the importance of the Prophecy that started it all, Eberron scribed the signs of the prophecy on rocks all over the world. Siberys became the golden ring that sparkles in the sky. Khyber became the underworld, trapped where she could do no more harm... yet.
Life in Eberron
At first, the only life on the newborn planet was the primitive life that Eberron had created. However, as the blood of Siberys fell from the sky, it spawned a race that combined the aspects of Eberron and Siberys magnificently: Dragons. Wherever a drop fell, a dragon would be created, and as the various dragons were formed, it became quite obvious that these were beings of great power. Capable of the divine and arcane magic that Siberys embodied, dragons roamed the world freely, exploring the lands and examining the inhabitants. The only competition the dragons had were the mysterious couatls, a draconic race formed from the blood of Siberys before it came in contact with Eberron. Effectively immortal, the couatls did not have the taint of mortality that Eberron had gifted her creations with. However, this purity also meant that the couatls were much more emotionally detached from the new world, keeping almost entirely to their home of Sarlona, leaving the dragons unopposed everywhere else. This continued for an unknown amount of time, an era in which dragons ruled all and very little changed.
Cruel Khyber, however, eventually found a way to interfere with the creations of her sisters. All of a sudden, an army of horrors erupted from the Underdark that Khyber resided in. This army was lead by the Overlords, demonic beings of almost god-like power. The dragons, not unified and prone to infighting, were no match to these creatures, and were enslaved for more than a hundred thousand years under the rule of the Overlords. Followed primarily by legions of Rakshasa, the Overlords were just as immortal as the Couatls and faced no opposition.
Then, a blue dragon named Ourelonastrix and a Couatl named Hezcalipa began discovering odd signs left on various rocks around the world. Working together, these two became the first to read a part of the Draconic Prophecy, left to them by Eberron. This prophecy showed the two how to defeat the the overlords, and they began to spread the message to others to prepare for war.
The War and its Aftermath
At first, the war seemed hopeless. The Overlords pride had lead them to spread themselves thinly across the world, meaning only one had to be fought at a time. However, every time an Overlord was killed, it would rise again shortly after. Faced with impossible odds, Hezcalipa convinced his people to sacrifice themselves in order to permanently destroy the Overlords. The couatls, also a race of immortals, used their own essences to create the Silver Cataclysm, a force that managed to imprison the Overlords where they could do no harm. Without their godly leaders, the remaining forces were easily handled by the dragons and a few remaining couatl. The dragons became the only powerful beings left on the face of the world. With significantly fewer numbers, but a new sense of racial unity, the dragons retreated to Argonnesen, creating new rules and laws to prevent future wars.
Faced with an age of solitary peace, the dragons devoted themselves to further studying of the Prophecy and developing the magical powers that had grown enormously during the war. However, as millenia passed, the dragons began to express interest in the outside world that they had fought so hard to protect. When they finally set out to see how the world had changed, they found dozens of new civilizations. The most advanced were the giants of Xen'drik, and some dragons decided to give this civilization the secrets to magic. Most other dragons decided instead to conquer as much of the world as they could, which lead to extreme internal conflicts. As dragons began fighting each other, one of the original Overlords began to awaken: Tiamat, the true Daughter of Khyber. All dragons, essentially nephews of Khyber, carried a piece of her corruption inside of them, and Tiamat's power was to awaken this corruption. From her underground prison, Tiamat corrupted hundreds of dragons, and when these dragons laid their eggs, the Spawn of Tiamat hatched into an army. Faced with imminent destruction, the dragons quickly reunified and destroyed all of the tainted dragons and their broods.
In order to better understand how an Overlord had managed to spread so much influence, the dragons turned to the Prophecy for much more intense study. What they found, they refused to share with anyone but the very elite of the dragon race, except for one thing: the sudden spread of draconic conquest lead to Tiamat's rise. After the incident, all dragons were called back to Argonnessen, leaving the subjugated races to face the newly magical Giants.
Reign of the Giants
As the dragons left, so did their enforcement of the laws on magic. The dragons were a very traditional race, and had followed certain restrictions on how magic was to be used, most of which had been written by Ourelonastrix. Once the dragons left the giants alone with their new knowledge of the arcane arts, the giants began to explore into areas the dragons had forbidden, particularly blood spells and planar magic. However, the dragons now feared what would happen if they became involved in outside matters, and resolved to simply watch as the giants began to conquer the rest of the world. The giants used the enslaved elves as laborers, and soon became the undisputed rulers of all of Xen'drik.
Elsewhere in existence, troubles were arising. Dal Quor, the plane of dreams, has a very strange life cycle. The alignment of the plane is directly tied to the alignment of the Material Plane, and every time there was a major shift, all of the Quori would effectively die and be reborn with new memories and ideals. Understanding that something in the Material Plane was about to cause a massive change, the Quori invaded Xen'drik and destroyed anything that they thought would help cause the shift. Faced with complete destruction, a dragon known as the Truthful One disobeyed his race and forged an alliance with a giant leader known as the Stormreaver. Using an impressive display of magic, the two managed to knock the plane of Dal Quor out of its usual orbit around the Material Plane, making it impossible for any Quori to manifest. The Stormreaver vanished, and with the nation of giants incredibly weakened against the onslaught, their slaves began to revolt. In the end, the elves succeeded in freeing themselves, some setting off for Aerenal and others remaining to become Drow.
Also, after seeing what happens when "lesser beings" made use of their magic, the dragons of Argonnessen instituted a new law: No secrets can be told to non-dragons.
The Daelkyr War and the founding of the Cults of Khyber
As the new Elven nations began to develop, they began to develop an interest in magic. After thousands of years of studying, the Aerenal elves managed their crowning achievement: the use of Necromancy, powered by the plane of Irian, to create the Undying Court, an alliance of completely immortal elves with powers close to those of the Overlords. Faced with yet another power that could rise against them, the dragons began an assault on the elvish forces. It became quite apparent that the dragons did not have their heart in the war, however, as very little of their force was committed to the fighting. The war has continued on and off up to the present day, mainly made up of long periods of peace and short, sudden bursts of fighting.
Then, one day, a black dragon named Vvaraak foresaw a terrible danger coming. Faced with a stubborn council that refused to help the other races prepare for the onslaught, Vvaraak left Argonnessen and began teaching the humanoids druidic magic in preparation for what was coming. These druids became the Gatekeepers, and Vvaraak had less than a century of teaching before she mysteriously vanished from the face of the planet.
Some 7000 years after Vvaraaks dissappearance, a new threat appeared: the Daelkyr, beings from Xoriat with incredible powers of creation and destruction. The Daelkyr are the supreme rulers of their plane, and each one created his own personal race of abberation to reflect his personal preferences. As these demigods flooded through with their minions into the continent of Khorvaire, they were met by the now strongly established Gatekeeper druids. The war raged for millenia, destroying most of the continent and ruining the powerful Dhakaani civilization, until the Gatekeepers managed to kill or banish all but 6 of the Daelkyr lords. These were the most powerful of the Daelkyr, and were barely defeated by the druids. However, before they could be entirely imprisoned in Khyber like the Overlords, the final Daelkyr lords created the Cult of the Dragon Below and reinvigorated the cult of the Lords of Dust, in the hopes of being released later.
The Cult of the Dragon Below serves Khyber, and seeks to break the balance in power between the creatures of Siberys and those of Khyber to release all those captured in the depths of the world. Should they reach their goals, hell would literally break loose over Eberron, as the god-like Overlords would be realeased without any hope of being defeated or reimprisoned without couatls.
The Lords of Dust is primarily made up of the surviving Rakshasa from the Great War between the Overlords and the dragons. This organization is much more selective and secretive than the Cult, and is known for infiltrating organizations around the world (including the Cult) to pursue their ultimate goal: the release of the Lords of Dust, the most powerful of the Overlords trapped in Khyber.
Both the Lords of Dust and the Cult of the Dragon Below are opposed by the Gatekeepers, who maintain the seals on the prisons of those imprisoned. While attempts have been made, none have been successful so far to release the immensely powerful beings that could bring the world into a new age of terror.
The Discovery of Dragonmarks, and the Eradication of Vol
As the dragons watched the destruction in Khorvaire without action, they also continued studying the ever-important Draconic Prophecy that promised to explain everything. Then, around 2000 years after the end of the Daelkyr War and the fall of the Dhakaani empire, the signs that Eberron had inscribed into the rocks began dissappearing, much to the alarm of the dragons. Even more alarming was the realization that the marks were not dissappearing, but shifting onto the faces of some "lesser beings." Confronted with the fact that the humanoids were also a part of the prophecy, the dragons began to argue heatedly over what they should do with the newly marked creatures. The Light of Siberys, the army of Argonnessen that had been formed after the Great War, wanted to kill anyone who had a dragonmark to prevent any of their enemies (namely the Lords of Dust) from using the information against them. Others argued that this was the will of Eberron, and that killing them would be blasphemous at the least or world-threatening at the most. The final decision would be to waive the rules of non-intervention in humanoid affaris to create The Chamber, a group of select dragons that would observe and interact with the dragonmarked races.
With the introduction of truly unique power in non-dragons, some dragons became interested in what would happen with a dragonmarked dragon cross-breed. A group of green dragons approached the house of Vol, and in the end the half green dragon Erandis Vol was created. Claiming success, supporters of the project spread the word that it was an attempt to end the elf-dragon fighting. In the end, it did, as both the elves and the dragons worked together to kill anyone marked with the sign of Vol. In the end, Erandis Vol's mother sacrificed her life in order to turn Erandis into a lich, cutting off access to her dragonmark and saving Erandis from persecution. Erandis Vol has spent the rest of her existence trying to reestablish her dragonmarked powers, and has formed the Blood of Vol as a religion to aid her.
Later, the Emerald Claw is formed as an additional cult that tries to follow in the footsteps of the original Emerald Claw: Erandis Vol's father. Their goal is to merge different races with magic to form the perfect race, and the members are all loyal to Erandis.
The remaining 12 dragonmarked houses become well established, and DDO starts in this time.
Present Implications
A lot of hints in the past have yet to be implicated in the present (though they may not be included in DDO, just PnP Eberron). Vvaraak, the creator of the Gatekeepers, never explicitly stated that the danger she foresaw was the Daelkyr invasion, and hints have been made that she actually saw something much worse that hasn't happened yet. The increased activity from The Chamber has lead to Tiamat stirring again, and her influence is beginning to become apparent on some of the chromatic dragons. Nothing is mentioned of what happened to the few remaining couatls, which could be our next good NPC race. Erandis Vol's goals are not yet apparent beyond that she wants her dragonmark back, and no reason has been given for her opposition of the Black Abbot's ascension to power. Especially for those unfamiliar with Eberron lore, a GREAT new endgame story line could involve the Overlords themselves, and it would thematically work well if it came out in the same update as Druids. I personnally see an introduction of some of the final 6 Daelkyr, with the newest adventure pack being focused so heavily on Xoriat and the creation of new races of abberations (edit: Hey, I was right!)
Up next: The DDO storyline, and how it fits into the rest of this.
(Main Source: http://eberronunlimited.wikidot.com/. Check it out!)