Walternate must have spent the last couple decades imagining people doing horrible things to his 8 yr old son, it makes sense that he'd have a violent knee- jerk reaction to the thought of harming kids himself. But Olivia was no doubt another influence, parents have a tendency to want to protect all kids.
As for Rachel, it's not unusual for an abuser to choose one child to take out their aggressions on, and leave any others practically alone. A lovely way of adding even more emotional trauma to other abuses. The ones singled out end up with even more "There must be something wring with me" syndrome than your usual abuse victim.
Maybe she's with Mrs. Dunham, wherever she is...I always thought that Rachel was a few years younger than Olivia.