But facts established in one episode are frequently contradicted in the very next.
However, Doctor Who at least TRIES to be internally consistent whenever the plot doesn't demand otherwise.
At any rate, the Masterplan idea was that the Doctor was one of the three great founders of Time Lord society.
(The destruction of Gallifrey happened off-panel between the old show and the new one; in Old Who the Time Lords were a strong recurring presence and absolute jerks.)
Rassilon was the most famous and often considered the only founder of the Time Lords. He was a genius, and had an ego so big that he is single-handedly responsible for making the vast majority of sentient life in the multiverse Time-Lord-shaped.
(Hence why most aliens look so much like humans; we all look like Time Lords.)
Despite being a colossal jerk who abandoned the other guy who helped design the basis of Time Lord technology, Omega, in an alternate universe and told everyone he was dead, Rassilon still managed to have his character absolutely assassinated in the Tenth Doctor's sendoff: if there's one thing that was established firmly and absolutely about Rassilon in Old Who, it's that he thought immortality was a pretty stupid thing to want.
The Cartmel Masterplan wanted to introduce the Doctor as a third founder of Time Lord society. Before the Three, Time Lords were just Gallifreyans, human-like aliens with a sensitivity to Time. Through the harnessing of a black hole called The Eye of Harmony, and extreme inventiveness by the Three, Time Lords become what they are today--including regeneration, which has always (until River Song) been presented as a kind of biotechnology rather than a biological trait.
(The details are quibbly, but regeneration can be granted, taken away, and extended--though that's a bad idea, as the base limit of 12 seems to be due to engineering tolerances.)
The Doctor was to be revealed as a return of The Other, who died in the biotech Looms that were used to create new Time Lords from mixtures of existing Time Lord DNA. The Doctor is a reappearance of The Other, his DNA having been spat back out eons later in a kind of rebirth.
