We totally don't understand how to start playing Shadows over Camelot. I only have three total players. We each have a die, 5 white cards, 1 loyalty card, and a coat of arms & have placed our respective miniture at the round table & have placed each a white card from our individual hands face up on the round table. All display fight 2 are numbered 2 and the other is number 1. What do we do now? We are all first-time players.
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It's a cooperative game. So, the first thing you need to do is decide, as a group, how to distribute the three white face-up cards among the group. You could decide that all three go to one person, or you could decide any other division.
This decision is often made based on which characters are in play. For example, if you're playing with Sir Galahad, you all might choose to put all special whites into the middle face-up and give them all to Sir Galahad (remember everyone starts with a Merlin, so everyone will have at least one special white), since Sir Galahad can play them for free on his turn. Likewise Galahad might play a high fight card to give to Sir Kay, since Sir Kay is more likely to do combats (e.g. for the armor, which is a good first quest to attempt).
You likely wouldn't want to give Sir Gawain any cards, since his special power is to draw an extra one, so he can fill up his hand at Camelot faster (the 'heroic action' at the round table is to draw more white cards, and he gets an extra)
Since this is your first time playing, especially with only 3 players, the rules strongly encourage not playing with the loyalty cards/potential traitor. I agree with this.
If King Arthur is in the game, he goes first, else the youngest player starts.
First you 'progress evil' by drawing a black card and doing what it says. Let's say that it's a Picts card, so you place a Picts miniature on the Picts battlefield. Now the player gets to do one thing. This can be to move away from the round table to a quest (place the miniature in a/the small circle of that quest), draw two cards (this is the 'quests heric action'), or play a special white.
I'd recommend option two for the very first turn, as it's unlikely you have enough cards to sucessfully complete a quest.
The goal is to be able to 'finish' a quest, and not waste a lot of time moving around. This means having two pairs of fight cards, a run of 1-5 fight cards, etc. to correspond to the quest (black knight or picts/saxons in those two cases). Strategy-wise, I suggest the group gets someone with a 'full house' (two of one fight card and three of another) and then go to the Lancelot's Armor quest, as the armor's power makes the game much easier.
Feel free to ask clarifying questions (comments) if you need more help.