FBI Section Chief Scott Blevins assigns Special Agent Dana Scully to the X-Files and teams her with Special Agent Fox Mulder. Her agenda is to give a scientific view of Mulder's investigations into the paranormal; in other words, to give the FBI administration reasons enough to shut the X-Files down. Scully reports directly to Blevins, who is overseen by a mysterious Cigarette-Soking Man, who has a connection to the Pentagon. M&S's first case brings them to Bellefleur, Oregon, where a generation of young adults seems to be victim of multiple alien abductions. They are experimented on and given implants; they carry scars and biological tags; post-mortem their bodies morph. The local population tries to silence the case; M&S's physical proof of alien activity is destroyed and the remaining implant is given to the hands of Blevins by Scully.
We witness the beginning of the Mulder-Scully partnership, but we won't have the full picture of the opening of the X-Files until 5X20: The End; it's assumed Mulder did all the work for himself ("and that's when I came across the X-Files"). The Cigarette-Smoking Man (CSM) is watching, for the time being only a mysterious figure even in the mind of Carter; but his influence over Blevins is clear. Mulder makes reference to a contact he has in Congress, who allows him to continue in the X-Files; we meet this contact, Senator Richard Matheson, in 2X01: Little Green Men.
The plan is to justify the closure of the X-Files with Scully's reports; Scully isn't expected to share Mulder's opinions, but she ends up being intrigued and not entierly dismissive of everything Mulder says. From there on, the plan will be to engulf the X-Files in the misinformaton plan of the Syndicate (4X24: Gethsemane). Scully's trust in her superiors is absolute, she is amused by Mulder's theories and doesn't hesistate to hand over the last piece of physical evidence, Soames's implant, to Blevins. The implant is stored in the Pentagon, with many other implants, as we'll see in 5X02: Redux. Scully nearly had a boyfriend in the Pilot (cut scenes), which shows what an organic process the creation of XF was.
The investigation takes place between March 7 and March 22, 1992. But the rest of the season takes place in the 1993-1994 period, concordant with the episodes' air dates. Carter wanted to set the Pilot at the time he really conceived the story, but we never learn what did Mulder & Scully do for the whole year of 1992-1993. However, the 1992 date is unnervingly coherent with 4X07: Musings of a CSM, 5X20: The End and the flashback episodes (5X01: Unusual Suspects, 5X15: Travelers).
Even with posterior knowledge it's difficult to explain what exactly was taking place in Bellefleur -- this is the Pilot after all, XF changed a lot before settling on a mythology. Test subjects belong to the same class of '89; a single group of the same age and setting is chosen for the experiments. Ray Soames's body was deformed ("homologous but possibly mutated mammalian physiology") but like with his classmates these mutations didn't occur during his lifetime. The experiments are apparently for hybridization through some kind of gene therapy, with its effects visible only post-mortem. We see both Karen and Peggy dead but their bodies haven't morphed like Soames's; perhaps the experiment is lightly different for each, or the morphing takes place long after the time of death, slowly. Also, Theresa's blood is red, she doesn't have the green blood characteristic of later hybrids (1X23: The Erlenmeyer Flask): these are 'light' experiments and not heavy genetic engineering.
The 'bite marks' on the test subjects have an organic molecule around them, at first sight characterised as "synthetic protein" by Scully. These marks must be inoculation scars, from the inoculation of the alien material. This proteine is what remains of this material; it's artificial because it was designed to serve as a means to carry the alien material, or it really is alien and Scully doesn't recognise it.
The hybridization points to the activities of the Syndicate. The implants could be of alien as well as terrestrial origin, most likely alien because of the extremely difficult place to access they're placed in (the "nasal cavity"). They're used for tracking and giving orders that the subject follows, they even have the ability to trigger and heal psychological disorders and subsequent physical ailnesses (Billy Miles wanders in the woods or is a vegetable on a hospital bed, Peggy O'Dell walks in the streets or is bound to a wheelchair according to the will of the aliens). "They would tell me [Billy Miles] to gather the others so that they could do the tests". Activating the implant, the "communication device", seems to trigger nose bleed (Peggy O'Dell & Theresa Nemman).
Under hypnosis, Billy Miles explains "But the test didn't work, they wanted everything destroyed, they said they were leaving". All the evidence is being swept (the graves are empty) and the after effects of the experiments on the test subjects are being eliminated (Billy is healed). The burning of M&S's motel and the theft of Soames's body wasn't part of that, these were doings of Det. Miles and other people like Dr. Nemman who want none of this matter to go out of their community, they think that they are protecting their children. Killing Soames and Karen Swenson was part of the experiments, to study the post-mortem effect of the tests. But Peggy O'Dell's death wasn't planned, she was hit by the truck when she was wandering, unconscious, fully under the control of the implant. The experiment is finished and everything is returning to normal. We see only alien activity and no Syndicate abductions, but the Syndicate was definitely aware of what is going on (or CSM wouldn't show as little concern).
Bellefleur could be one of the abductee lighthouses mentioned in 5X13: Patient X. See 7X22: Requiem.
Mulder: "Sorry, nobody down here but the FBI's Most Unwanted."
Scully: "Agent Mulder. I'm Dana Scully, I've been assigned to work with you."
Mulder: "Oh, isn't it nice to be suddenly so highly regarded? So, who did you tick off to get stuck with this detail, Scully?"
Scully: "Actually, I'm looking forward to working with you. I've heard a lot about you."
Mulder: "Oh, really? I was under the impression that you were sent to spy on me."
Scully: "Do you have a theory?"
Mulder: "I have plenty of theories."
Scully: "The answers are there. You just have to know where to look."
Mulder: "That's why they put the 'I' in 'FBI'."