Newbie Question: What is the main source for Lunacy?

I just started the game a couple of days ago, What should I do and how do I get lunacy if I'm stuck at a certain level, and where can I get Lunacy??

Additional Questions:

Which Identities available for Dispense Should I focus on? I like Mersault, HongLu and Yi San, which Identities of these three would you recommend?

and finally how impactful is team building in this game? can you get away with just using anyone you like? or is the game too hard and you need strictly need to use one character with the other type of thing?