This answer contains spoilers… (view spoiler)[In the very end of book 2, somewhere around Chapter 40 when they are all back in the present, there is conversation between Ysabeau and Sarah. It is revealed that Emily died in a fight/battle when Margaret was born or when it was discovered that Sophie and Nathaniel were having a child. It was brief. Hoping book 3 discusses it more. (hide spoiler)]
Rusti (Rachael) no you didn't miss anything, I thought this too when I first read it and again when I read it for the second time in preparation of reading the 3rd book. And since I am not the only one that has asked that question I have to assume we didn't miss it.