Why does John believe that the dead god was, in some sense. "unconquered" in "By the Waters of Babylon?"
We do not know for certain why John felt this. Benet does not have John say “and I thought he was unconquered because…” All John says is that there was some sort of unconquered look about the man’s face. I would suggest two reasons why John might have felt this way.
First, it seems likely that the simple fact that the “god” was still physically intact would tend to make John think that the god was unconquered. The city was destroyed long ago and yet this “god” is still in his original form. That, along with the fact that John thinks of him as a god would probably impress John very much and make him perceive the god as unconquered.
Second, you can look at what John says about where he found the “god.” The god was looking out the window, seemingly calmly. He was looking out and accepting what was happening to his city. As John says
He had sat at his window, watching his city die—then he himself had died.
This would tend to imply that the god was unconquered. He did not give in to fear when his city was destroyed. Instead, he was able to look with equanimity at what was happening. This would make him seem like a person who had not been conquered.
Thus, even though all John really says is that he could tell the god was unconquered by the look on his face, we can surmise that there are other reasons.