And yeah kinda sucks that Korra can no longer contact her past lives but at the same time they gone into a new era so I guess even the Avatar has to start over with a clean slate and it balances the light and dark avatars out putting them on the same playing ground.
Holy crap I'm still a total noob at this fandom and look how deeply I'm reading into this!!!
Thats probably because Rawa and Wan are different people then a demon overlord Watu.
And yes, Unalaq was killed. However, Watu can't die (as explained by Rawa long ago) and if I had to guess, I'd say that a baby Avatar was born somewhere immediately after Unalaq's death.