Harmon was arrested at the end of season 1. I have season 2 but it doesn't pick up where season 1 left off. What episode do we find out what happened after his arrest?

Skeleton Crew scenes are in Death Watch (S3), with an explication and then a recounting of subsequent events.
Legend reports a DPB/Mooves powwow to save JAG. Meg was too good, so Mac was created to attract viewers.
Losing Diane is the trauma that hypnotizes Harm, triggers fascination with Mac: see 1st meeting, We the People.
Many of our attractions / aversions are actually generated by the emotional energy that lingers from past trauma.