Why was Raditz killed?

1) Goku tried to spare Raditz, only for Raditz to use it against him. 2) Raditz was far too strong for him and Piccolo to control at the time. In other words, Raditz had to die because of necessity, NOT because he deserved it any more than Vegeta did.

Does Raditz come back to life?

Raditz was not brought back as he had hoped though, but with the continuation of the Dragon Ball lore with Dragon Ball Super, he could easily return and become a main character along with his brother and Vegeta.