
I don't remember the cutscenes specifying how Bahamut was killed, but apparently he was defending Meracydia not just from the Allagan Empire, but from Xande with his crazy Cloud of Darkness bullshit. Xande and the Allagans apparently knew how to permakill him but not how to trap his primal form in Dalamud and harvest him for solar energy, the Ascians had to teach them that. But as for Tiamat's imprisonment, it sounds to me like she just wanted the worst punishment for herself that she could think of because it's the only thing that comes close to atoning for what she did, in her mind.
Maybe Midgard wasn't around to revive Bahamut because he wasn't around before the corpse was destroyed? Maybe whatever void-y darkness BS killed him corrupted the body? Or maybe he's only able to resurrect lesser dragons. When you kill the dragons he resurrects in the boss fight it takes substantial chunks of his HP, and although he's in a weakened spirit form there probably, in life it probably would have taken just as much or more out of him...
Maybe Midgard wasn't around to revive Bahamut because he wasn't around before the corpse was destroyed? Maybe whatever void-y darkness BS killed him corrupted the body? Or maybe he's only able to resurrect lesser dragons. When you kill the dragons he resurrects in the boss fight it takes substantial chunks of his HP, and although he's in a weakened spirit form there probably, in life it probably would have taken just as much or more out of him...