Well, a big thanks to Sub-Scorpion for Liu Kang's official bio(posted below)
But this does give us a few answers, as well as a few questions. Apparently, Raiden's God Essence Blast killed Shang Tsung, and let Liu Kang's soul free. Liu decides to stay on Earth and help fight Onaga, but he also states that his body is off reaking Havoc on everyone. He's even killed a few people. But the question is, how is his body up and moving? Obviously the body has been free and moving about ever since Onaga was resurrected, and maybe even sooner than that. I have a few theories on why his body is up and moving.
-Maybe another warrior has possessed his body...maybe someone who was killed by the Deadly Alliance dutring the tournament. Maybe Kano? Maybe Midway is messing with our minds and instead of Liu Kang possessing Kano's body, Kano has possessed Liu Kang's body. It could be possible, but it's highly unlikely considering it clearly states that the body has retained all of Liu Kang's fighting skills.
-Maybe Onaga has ressurected Liu Kang to help him out. In Tanya's bio, it says that Onaga was watching from beyond the grave while Shao Kahn was fighting over control of Earth Realm during MKII-MK3. Liu Kang is the one who stopped him both of those times, so Onaga could have realized that Liu Kang would be needed. It's possible.
-Maybe Liu Kang's spirit is actually causing all the Mayhem, but he's tricking everyonehis (Hence Deception) into believing that he isn't. He would need a motive, and the motive could be that he has become angry that he was killed and he is no longer the person who stopped the threat of the Deadly Alliance. Jealousy perhaps. Maybe he is mad at Earth Realm's warriors for letting Kitana die(If she is in fcat dead.) Maybe he has no choice but to kill? Anything is possible.
-Or maybe Liu Kang's body is just up and running without any reason on how it's doing so.
OFFICIAL BIOGRAPHY
Liu Kang
The sorcerer Shang Tsung had killed me and consumed my soul. I remained trapped within his being, tormented by his evil, along with many other victims of his vampiric soul drain. Through Shang Tsung’s eyes, we witnessed the battle with Raiden, who sacrificed himself to stop Onaga. Raiden’s blast destroyed Shang Tsung, and our souls were free to ascend into the heavens. I remained in Outworld, however, to aid my friends in the fight against the Dragon King.
Why someone would desecrate my grave and reanimate my body, I cannot say. Somehow my corpse retains my knowledge of martial arts and has killed many innocents. Though I am not the perpetrator of these slaying, I cannot help but feel responsible for the brutality committed by my corporal form. The battle between mind and body has begun.