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leaching off someone else's idea would be trying to pass their product off as our own. In our case, that is not the case
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The idea of air bender was not one of yours therefore: somone elses idea
You are using the idea [without the permision/against the will] of the owner of the idea therefore: leaching/stealing
Need I say more?
There is a reason that companies send cease and desists to projects like this and part of that is that if they take off they can be very damaging to companies. Avatar already has authorised games of the same genre (exspecialy the ones for the GBA) and they could easily say that this is competing against them.
Also because you're team isn't a real company you are liable for the effects so if they were to sue it would most likely be from your pocket.