The Wrestling Observer newsletter is reporting that the scheduled plans to merge ECW with Raw have now been dropped. It appears the main reason is that Monday night's are a much more hectic taping day in WWE and adding ECW to the schedule would become too stressful. It would also be difficult for ECW talent to secure house show positions as Raw's roster is deeper than Smackdown's.
As much as I hate posting news from Wrestlezone, I think it was this site that was spreading the rumor that ECW was merging with RAW as if it were concrete despite JR saying that it wasn't true. I'm glad, though. ECW seems like a mini Smackdown anyway.
I say Austin comes back in about 6 months, gets in the middle of the ring and apologizes (or something close) to the WWE and fans for walking out. He says he was hurt by words the Rock & Vince said, but it made him think.