Quest bug: Quests reset after disconnecting

I was on the quest right after saving Deckard Cain, where my internet had a small lapse and disconnected me. On reconnecting, it didn't take me to my last location or my last checkpoint, but rather to the start of the game

As you can see in this link, this is the dialog with Cain right after you save him. I was confused that I had to defend the gate again.
http://i9.photobucket.com/albums/a80/ogwiz/Screenshot000.jpg

Now, at this link, I realized that my quests reset. Notice the level I'm at.
http://i9.photobucket.com/albums/a80/ogwiz/Screenshot002.jpg