Re: PAVO
There's probably some gaps missing, but from what I can tell, Syaoran-kun's parents are copies of himself and Sakura-chan that were taken back through space and time. The children we were originally traveling with were those copies, not the Syaoran-kun and Sakura-chan that are here now. Whatever it was that ended with our travels, it affected the copies in some way, causing them to ... ah, lose their bodies. I'm not sure.
One way of looking at it is that the copies returned to their original states, returning to Syaoran-kun and Sakura-chan. But we don't think that's the end-all scenario. That's why we're traveling again.