Keep in mind Austin was a host for a WWE special just a couple of months ago. I've also heard that he and Vince ARE on good terms and that he has NOT ruled out a possible return to the WWE in the future.
I don't care if he wrestles or not, it was never his in ring ability that made him entertaining, but his persona. Nothing was more exciting then watching someone getting gang beaten in the ring at the end of raw, and hearing that infamous glass shatter as Austin runs to the ring, stuns everyone and drinks beers.
Whatever the case, WWE needs something new, and bad. They need a major fulltime return by someone. They also need to start mixing up rosters between Smackdown and Raw, it's getting tiresome watching the same people fued amongst themselves.