Last time I recall was when sasuke's team was fighting at the kage meeting place. It's been a while, but it appears the teammates never made it out, so my guess is that the sword was still there as well. Also, waterboy said he's looking for his katana, so I guess he thinks zabuza's sword is still there?
So apparently "blast" and "scorch" are elements now. I suppose if "ice" is an element, then it suffices to say that the fusion of two elements is still considered an element. So would that mean that blast is fire+earth and scorch is fire+wind...?