How is Onaga screwed at all?
Cyrax is from Botswana
Lin Kuei is based in China
Its heavily implied that Cyrax isn't dead
Maybe the Red Dragon is a cult that awaits for the return of Onaga (like a Mesiah thing), to be honest I think it's cool to put a new story behind them, the RD sucks ass right now, and I don't care about Onaga, so if they unite 2 boring things and craete a new and more interesting thing then and I'm all for it.
It's honestly your best bet as an Onaga fan. Because as of now, the events of the story aren't lining up in his favor. Reptile isn't a wandering monster anymore, and it looks like the "Devolution" has been retconned from his story. So Nitara can't exactly trick him along with Cyrax (who is MIA at the moment) into going into the Dragon's lair.