Learn English – The use of ‘because although’ in the middle of a sentence

I think the best way is:

Indeed, the absence of a segment causes a lack of graph edges which refer to that segment, leading to a distorted cycle which produces a fault corner.

Alternatively:

Indeed, the absence of a segment causes a lack of graph edges referring to that segment, leading to a distorted cycle that produces a fault corner.

This assumes that the prior sentences cause the "indeed" to make sense. Otherwise, remove it.

Your sentences look fine to me. One possible way to make the reading smoother is to move the reference to the front or the back. For example,

As described by Horde and Susan (2012), in regularization of outer-boundaries, boundary line segments can be first fitted from irregularly distributed contour points, and then rectified by rotating their mid-points until orthogonality or parallelism is met with respect to the identified direction.

Here is another alternative,

As described by Horde and Susan (2012), in regularization of outer-boundaries, boundary line segments can be first fitted from irregularly distributed contour points. They can then be rectified by rotating their mid-points until orthogonality or parallelism is met with respect to the identified direction.