Stuck on Xenogears

I'm at the point where Fei is (SPOILER) trapped in the Kislev prison and I just got done with the Gear battle tourney. What do I do now?

Just explore the prison, talk to people. Most importantly, you want to talk to Hammer the Supplier and the new doctor, when he arrives. You're supposed to be poking around, keeping an eye out for an escape route.

I talked to Hammer and (SPOILER)Citan and the Doctor doesn't do anything but say that he's a doctor and I'm a prisoner and Hammer just sells me stuff.

ok I think you should try talking to the champ aka Rico. After you beat him in the battle arena he gives you his title and his apt. and then runs off. This should start another scenario.

Can you go back and battle again? It IS a tournament.

Have you beaten Rico yet?

I go to the battle arena, I only end up fighting two other weak robots and only get about 500 gold per bot I destroy. The fighting arena is fun, IMHO.

I think you're supposed to battle your way to the top, resting each day and talking to Citan.

Each time I talk to Citan he just says "While we're here I am a doctor and you are a prisoner, we must keep our positions known." or something like that.

Yes, you get more money every day, up until your final opponent, Rico.

Well, I'm now in the sewers, looking for some monster with Rico and Citan. I have yet to be stuck in there,

That place is the most annoying place in the game...except maybe the Babel Tower/Shevat's route.