There is no separate preprocessor pass. The parser front-end calls $LK,"Lex",A="MN:Lex"$() which has the preprocessor built-in. The compiler looks ahead a token, most of the time, so you might throw an extra semicolon after a directive if it's not taking affect right away.
$FG,2$#exe {}$FG$ Will execute code at compile-time and can be used to insert code into the stream being compiled using $LK,"StreamPrint",A="MN:StreamPrint"$().
$FG,2$#define$FG$ Define string const
$FG,2$#assert$FG$ Print a warning during compilation if an expression is not true.
$FG,2$#if$FG$ Include code if an expresion is true.