Will C2 autotrading reduce position sizes in existing open positions for a system if I reduce the scaling factor for that system?
Furthermore, if my account gets drawn down with existing open positions, will C2 automatically reduce position sizes in these open positions to control risk?
1.) Yes.
2.) No. Scaling has nothing to do with your own account equity. Scaling is always relative to opening size of C2 Model trade, so as account size declines (or increases) your quantity held does not change.