If a Direct Offline Processing is applied using the respective window [F7] an audio file in the “Edits” folder is created.
Undoing [Ctrl + Z] this right after will remove this audio file. However, once the project has been saved and for some reason one wants to reset all the particular processes by deleting them in the Processing window, the audio files remain inside of the “Edits” folder even though they are clearly not being used anymore.
This is easily replicable by simply creating an empty project, importing any audio file with the “Copy File to Project Folder” function checked, then pressing F7 adding for instance “Reverse”. After saving & closing, reopen the project and now delete the “Reverse” processing also by hitting F7 (clicking on the trash can). The audio file will sound normal again. If the Reverse.wav file in the “Edits” folder is manually deleted, Cubase will ask you for this missing file even though it is surely not used anymore. The solution is redirecting Cubase to the original file stored in the “Audio” folder of the project. This sort of behavior seems like a bug. Even when using the Back up Project function while having checked “Remove Unused Files” the processed audio in the “Edits” folder will come along even though it is not used whatsoever. This seems like an indexing kind of error to me.
When the unaltered audio event is bounced (without any processing applied whatsoever) this issue gets resolved.
I’m in your situation and haven’t figured out why Cubase is behaving that way. You say about redirecting to original file. How do you do that?