How is Taven okay in the Netherrealm? Only evil mortals can go there without suffering.
Perhaps it is because he is a demigod. Raiden in Mortal Kombat 9 was able to go to the Netherrealm and back without any difficulty when he unsuccessfully tried to to make Quan Chi an offer of his and other fighter's souls to change sides against Shao Kahn unaware that the Emperor of Outworld and the Necromancer had already made an arrangement of their own. Though there is another question that should also be asked: Why is there an obelisk in the Netherrealm?
Although the Kreate-A-Fatality is one of the most criticized things about this game, there is some Fridge Brilliance involved here. The other games were, more or less, formal tournaments, and even those that weren't were bouts between kombatants. Armageddon is different. Here, it's a chaotic free for all. Would the warriors really have time to perform elaborate fatalities on each other on the field, or would they just settle for hacking at each other until somebody dies? In the case of the latter, that's what the Kreate-A-Fatality seems to be simulating.
It's pretty much established that Shao Kahn wins, but remember that part of the story where Shang Tsung claims that everyone who pledged allegiance to him will return from the dead to continue serving him? And now that the Forces of Light are killed off....
In his bio for Mortal Kombat: Armageddon, it's revealed that Shao Khan can revive allies of his who had once sworn allegiance to him, and if he died, so do they. Now, let's list all of the characters who had allied themselves with him: Kintaro, Motaro, Goro, Shang Tsung, Baraka, Reptile, Reiko, Mileena, Kitana, Sindel, Jade, Kano...
Is it sad that I immediately yelled out "MOORTAAL KOOMBAAT!" after finishing that list of names?
Also, in that same game, it's revealed by Fujin that, when a god is destroyed, they're revived as a "blank state", forgetting all of their past life in the process. Note that this is not what happened to Raiden after his attempt to take Onaga with him at the beginning ofDeception. So, what happened? According to Epileptic Trees, he was corrupted by Onaga in the attempt.