それはとんだ災難でしたね。
That was quite misfortunate, wasn’t it?
さっきは災難だったね。あの先生、みんなにうるさいからさ、気にしない方がいいよ。
That was too bad earlier. That teacher is always nagging everyone, so it’s best not to worry about it.
In both examples, they refer to a situation rather than a person, so unfortunate is a better definition. I added it as a synonym but wonder if I am missing a nuance here.
Both JMdict and 研究社 translate it as “misfortune”. For instance 災難よけ is translated as “a talisman against misfortune”.
Note that ‘unfortunate’ is an adjective while ‘misfortune’ (and 災難 for that matter) are nouns. So それはとんだ災難でしたね could be more literally translated by “that was quite a misfortune, wasn’t it?” but of course that sounds a bit awkward in English.
I think you may have a point that the translation chosen by Wanikani here, since it uses an adjective, would be a bit more natural with “unfortunate”. But “unfortunate” is not a good translation for 災難 on its own.