There is a very basic reason why Crono could have lost to Dalton that all of you have ignored.
He's no longer the main character, so he doesn't have author's immunity to threats anymore... >.>
In all seriousness there was no mention of Crono's or Marle's OR Dalton's actions during the downfall of Guardia. Heck for all we know they could have been off using the Epoch to have a nice reunion with some friends, then they come home and the castles burned down. Indeed it's not very likely, but it does illustrate the fact that with our level of knowledge right now ANYTHING could have happened. Dalton could have killed them, or the crew might not have been around during it (sneak attack while they are away anyone?), or anything in between. Anyone who says without a doubt that Crono is dead because Dalton invaded is an idiot, and anyone who says without a doubt Crono could never be beaten by Dalton is also an idiot. We are not writing the story and we have very little information to work off of. We just can't know these things until they give us some more information somehow (from a new game, an interview, a remake, whatever).