Bukkit isn't dead, but CraftBukkit is essentially a zombie. I'm guessing it will be for months, if not just tossing the project into the pyre while Mojang continues to build their own API. It will be incredibly hurtful to the server community in the meantime. Even if Mojang and the developer come to terms, the door is open now. Basically anyone can issue a DMCA takedown against servers that distribute this mix (or, .jar) as long as they've contributed to the code.
It's DMCA gone wrong (and used correctly, ironically), and if it didn't affect me so much I'd love to be watching on the sidelines on how this all plays out.
So it goes.