I came across this problem many times.....during the underground model conversion i always find that the pipe densities and fluid densities of the model are disturbed(not only of single element but a lot) and i always find it difficult to rearrange as you know in underground models there are a pretty large amount of elements...........is there any way that this problem doesn't occur?

The Buried Pipe Modeler sets all densities of buried elements to zero. This is done since the assumption is the soil can support the weight load of the pipe, and therefore there will be no weight stress. The only way to achieve this is to zero the densities.

Does it mean it is okay with all those elements having both pipe and fluid densities as zero??

Weight is continuously supported by the trench. CAESAR II does not have a continuous support (foundation). Therefor, to get a good soil model (with point supports) for strain evaluation, CAESAR II eliminates weight which would cause bending about these point supports.
Yes, in most cases, it's OK.