Okay I never did have a problem with Liu. His screams were funny, and yeah he's looking to be the main character of MK. If this stuff is true, and Liu has some tie with the dragon king, an evil zombie Liu could be quite cool.

He could do invincibility type moves in defense (kinda like Jade), he could have the flying kick and bike kick. His fireballs I would change it a little. I would just have him stand there and fire off with just one hand (think Pyro from X2).

I wouldn't have the turkey yells this time though, just a silence with maybe a grunt. I'd like Liu to have the ability to kinda speedup if you can chain his attacks (to show how ruthless he is) but of course if you miss he is vurnlerable.

For fatals, I'd have him have the neck snap, maybe somesort of plasma drain (think The Mummy), and of course some type of dragon fatal.