I can't find the site that I read it on originally to double-check, but I believe they originally had an explanation prepared for how Cat survived or the ship didn't actually explode or something, but they got word at the last minute that the show was being cancelled. But then after they'd already thrown out all of the storyboards or whatever, Nickelodeon told them that oh, hey, you're not cancelled and we need a second season in [ridiculously short amount of time], and oh yeah, no character deaths, FIXIT. So . . . they rushed for an easy explanation and that was it.

The moral of the story: Everything that was ever terrible about your favorite childhood shows was ALL NICKELODEON'S FAULT, ALWAYS.