Does seeing flaws in the suitor after Salat al-Istikhara mean that marrying him is not good, and if so, will the engagement be annulled or will it not be facilitated from the start?

Performing Istikhara (guidance prayer) regarding marriage is a good thing, and it is not a condition for the person performing it to see a dream afterward. The sign of Istikhara lies in whether there is facilitation for the marriage to be completed or not. Therefore, do not pay attention to dreams. Instead, inquire about the young man from trustworthy individuals. If they speak well of him, then accept him. You may also repeat the Istikhara. Allah will bring about what is good, whether the marriage takes place or not. For it may be that He prevents some harm from you, in accordance with His Almighty saying: "And it may be that you dislike a thing which is good for you and that you like a thing which is bad for you. Allah knows but you do not know." Ask Allah to replace him with someone better for you. It is permissible for a woman to seek a righteous husband and to offer herself to suitable men within the bounds of Islamic etiquette.