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The radial distortion parameters (k1 .. k3 or .. k6 for the ration model) and the tangential (decentering) parameters (p1, p2) are meant to be applied to normalised image coordinates, that is
where u, v are image coordinates and x, y normalized coordinates. It doesn't make much sense to talk about a unit for the parameters of either these two distortion models, since they are just coefficients for approximating (through Taylor expansion) some unknown true lens distortion function. Every calibration implementation I have ever seen has estimated the distortion parameters for normalized image coordinates, as this is ubiquitous in the literature.
Without seeing the incorrect undistorted images, I can only speculate about the cause of the problem, but I think it might be related to