Here is a quick recap:
After the squad entered town (The main group through the gates and Dietrich through a winding back road (Dietrich took another route and left days earlier, while the group was in a coma). The Captain and a few men also is nearby, but they took a third path to enter the city from another angle) they quickly found themselves under attack. Flare Redleaf stayed inside a garden that was green and flowery despite of winter.
Meanwhile the group advanced further into the city and explored two buildings: A smithy and the jeweller shop / magic shop across the road (the shop had two parallell doors leading into the same establishment with two counters. One half of the room was a jewellers shop, the other an arcane shop. Like the rest of the city the shops were empty, but Sharee spied the outlines of ghostly figures)
Within the city the group began having visions and recollections of memories that weren't theirs, but it became evident that in some ways they were connected to the city.
Then the assassins triggered their ambush and the fighting began in earnest. Roack got shot through the legs, vomited, passed out and then reawakened to crawl towards Flare in the park. He has not quite reached that location, but has stopped in a corner where Solstara, the unfortunate concubine - now in werewolf form - has dragged the unconscious Hans Sternflucht.
As the fight proceeded the group discovered more of their tattoo-begotten powers whose magnitude is now at its zenith, close to the mountain (their source of power) as they are:
-Solstara turned into a werewolf
-Domunsoka changed the weather
-Hunthar turned into a spectre
-Domunsoka awakened the chinese style fu-dogs at the gates with an instinctual ability of one of his tattoos. He is bonded with all the sentinels and buildings in the city. Within the city Domunsoka is the most powerful of the group, but many of his abilities are tied specifically to the city defense.
There seems to be some confusion: Sharee ran through the jewellers store and to the top of the roof, but suddenly she was on street level again (Given her tattoo powers that is feasible, but likely not planned). She is now inside the jewellery shop again, this time facing Marcus, your quarry.
Domunsoka is not on the main street, but is some twenty to forty yards down an alley, kicking assassin arse. The rest of the group had a good view of his actions from the intersection they were in as the ambush began.
As the battle proceeded more and more assassins arrived. This is somewhat illogical* as there were but a limited amount of mercenaries that defected and joined Marcus. Through the text you should also have surmised that the traitors are tainted by some kind of demonic influence, but not all the characters are privy to this piece of meta-information.
Far down in town is Dietrich, now unconscious (possibly dead... wait and see) and the Keldon Witch. The Keldon Witch is, as you may have gathered through the dreams and bits of dialogue you have read, the source of your tattoed predicament, and she is now tied to you in mysterious ways.
Hope that helps.
*Illogical, but not wrong. Your PCs ought to wonder where the HECK all those guys came from.