Interesting version that I hadn't come across before - I wonder where Crooked Still found it? However, those 'cards' look mighty like mondegreens to me. A version from San Jose, CA, has the following verses:

What have you done my pretty fair maid?
What have you done, said he
For don't you see my own heart's blood
Comes trickling down to my knee?

It's not an unimaginable leap from 'heart's blood' to 'cards flash', and 'trickling' to 'twinkling'. And the idea that she begs him to live - from your other 'cards' verse - is contained in another verse from the Ca. version (although it isn't consecutive):

Oh live, oh live, Young Henry, she cried
One half an hour for me
And all the doctors in Yorkshire land
Shall be at the cure of thee

It's just possible that the cards being 'around the waist' harks back to an old Scots version in which the victim has a hunting horn around his waist, but that's a bigger leap of the imagination.