The possibility of nVidia scrapping the NV30 is still there with the surprise being that there have been no emphatic denials yet. Even more surprising is that nVidia's partners have not said, or leaked, a word about the whole affair. The usually extremely talkative distributors have kept their lips shut so tight that it is likely that a gagging order, from the producer must be in place. It is rumoured that nVidia are not only not letting them talk but are keeping them completely in the dark. The same rumours also claim that partners will remain in the dark until one week before nVidia actually ships anything to them.
One explanation behind what may be happening is the possibility that the GFX core may be facing some overheating issues. Although many chips encounter difficulties while in development, a problem arising so close to the release date may damage the image of the upcoming chip but may also affect, adversely, the producers reputation. A reputation which nVidia would go to extreme lengths to protect. That is why such a fault scenario for the GFX seems likely. nVidia would try to keep everyone in the dark, possibly their own people too, while working at a frantic pace, behind the scenes, trying to fix whatever may be wrong. Suggestions that nVidia may scrap the GFX core completely seem unlikely, since except for the vast amounts of money poured into the project, there is also a question of prestige and allowing ATI to have the fastest product out there will be hard for the company to bear.
The possibility of a total reworking of the core, if indeed there is a problem, might make business sense, since nVidia has a well established market lead created by the sale of mid-range cards and not high-end ones, but if ATI decide to make the 9700 a budget board when the RV-350 (9900) is released, all sorts of things could go wrong for nVidia.
After all a successful mid-range sales record was only created for nVidia with the trust it instilled in customers by always having the best chip out there. If ATI take that away for long enough they could seriously move into the mid-range board market, the most profitable segment of desktop graphics.
Any effects of the scrapping or just the delay of NV30 will not be immediately felt anyway, it will only be another step up for ATI in their quest to reach nVidia in the ongoing graphics wars.