I think they are considering better locations (somewhat more popular) than Vero and HHI.
As far as Veo being a "failure", here is what happened. Sales at Vero were so slow, that the resort was never fiinished to the original design. There were supposed to be several villas on the other side of the road, via a connecting tunnel. That phase of construction was canceled, and some (maybe all) of the land sold off. Given that, yes, though what exists is a lovely resort, it could be considered by many to be a "failure." Also, constant upkeep of the beach, with the erosion and hurricanes, has been expensive.
I think they are looking at areas with less severe weather as the norm. Vegas, however, certainly does flood from time to time, depending upon where exactly the considered property is located. While a relaxing desert vacation sounds nice, there are just too many reasonably priced options available to make me want to spend points for Vegas.
Cabo sounds interesting to me, or Puerto Vallarta (cheaper airfare from here to PV). I think a Mexico vacation would be fun, given that I would feel more secure at a
DVC location, even though I realize it is only a perception.