The next version of WinSCP will automatically restore the editor options defaults when changing editor command from Notepad to 3rd party editor
https://winscp.net/tracker/1872

I cannot explain what happened to your sessions.

For editor: make sure to uncheck the External editor opens each file in separate window (process) option in editor configuration:
https://winscp.net/eng/docs/ui_editor_preferences#external

I shut down my work system when I left Friday and when I started up this morning I seem to have lost all my saved sessions and the ability to edit files using Notepad++. As soon as I open a file it says the external editor was closed.