The fact that Madara calls Sasuke his child got me a little as well. Though he may just referrer to it a statement which is not even directed towards Sasuke. ( Alike that he means that he would kill his friend, brother or even his child if he had one ) It may also be that Madara actually did kill Izuna, however, Izuna would've died regardless. It may also be that whatever Madara did to Hashirama during their last battle caused Hashirama's death.