Discarding, Drawing, and the Deck
Your deck will always start with 7 cards. On your first conquest phase, you will be drawing five to use as your hand. When those units are destroyed, or at the end of the phase, those 5 cards will go to your discard pile.
Any cards that are purchased during the acquisition phase also go into your discard pile.
Your discard pile is shuffled together to create a new deck only when your deck has run out of cards.
For example: when you go to draw cards for the second round, you should have 2 cards remaining in your deck. Draw those, then shuffle your discard pile (which includes your cards used in round one, plus any cards you purchased) and this becomes your new deck. Draw the remaining 3 cards you need for a full hand of five from the new deck.