The film was originally shot with a sub-plot involving Admiral Bill Wilson as the traitor that compromised the Pegasus station. There were a number of scenes between Wilson and Bokoth, the commander of the Kilrathi battle group, but since the Kilrathi puppets weren't realistic enough this sub-plot had to be cut out. There was also a knife fight on board the Kilrathi ConCom between Blair and Commander Gerald. Wilson goaded the two into the fight but when they decided to cut the traitor sub-plot the scene was edited so that Wilson never appeared in it. However, after a test screening with the knife fight, the viewer reaction to the edited scene was mainly confusion so the fight was ultimately cut out. If you look closely, when Paladin gives Blair his Pilgrim Cross Blair has a bandage on his hand. This was because Gerald wounded him in the knife fight. Blair used his Pilgrim Cross knife to kill Admiral Wilson and basically end the fight, proving to Gerald his loyalty to the Confederation.
Merlin was also mean't to be Blair's private digital companionmentor. The character was supposed to add comic relief to the film but it was decided that Maniac could fill that position, so Merlin was relegated to a background computer system onboard the fighters.
Adding to the traitor subplot, Captain Sansky was also supposed to be the traitor aboard the Tiger Claw. In the end he was to have committed suicide rather then be caught. But when the entire subplot was cut, the film was re-edited so that it looked as if Sansky died from the head injury recieved earlier