You divide the damage as you cast Chandra’s Pyrohelix, not as it resolves. Each target must be assigned at least 1 damage. In other words, as you cast Chandra’s Pyrohelix, you choose whether to have it deal 2 damage to a single target, or deal 1 damage to each of two targets.

If Chandra’s Pyrohelix targets two creatures and one becomes an illegal target, the remaining target is dealt 1 damage, not 2.