Sentinel says "Omega threat eliminated." So I think so, not only the Morlocks, but Banshee, Madelyn Pryor, Gambit, there's gotta be a rewind mechanic on this one. Sad part is next week is the dumb Storm arc Lifedeath Pt. 2. Maybe they'll split it in half like they did with Motendo to give us some explanations going into Episode 7 - 10. Also Wolverine has been held back so far in this series, need less Scott and Madelyn mental hanky panky and more Wolverine tearing things to pieces imo imo. I'll give the series the compliment that they do a really good job of making each of the X-Men look like the badasses they are though, even more reason I think Wolverine's time is coming.

I think Cable will come back and fix it.

I just rewatched the end of the episode and it looks like Madelyn, Banshee, Marrow, some other Morlocks, Magneto and Gambit were all killed.

BUT, like you say, I think they needed a convenient way to ice the Madelyn Pryor storyline. What if they just found it? I read a theory that maybe Leech was dampening Magneto’s powers, leading the Mega Sentinel to believe that he’d been eliminated when he’s actually alive.

If that’s the case, then the only major loss was Gambit. And, sadly, that works. You can’t have the mutant equivalent of 9/11 without having a major cast member bite the bullet.

If they killed Gambit off for good (or the forseeable future), then Nightcrawler better take his place.