No, Disney is not cancelling reservations. Unless, of course, you call and say "I want to cancel my reservation." Disney is sold out across property for this weekend, but if you cannot make it due to Hurricane Frances there is no cancellation penalty.
Disney *may* cancel your reservation if you are not guaranteed. I.E. you do not have a deposit or credit card on file. Sometimes people call up and say, "I want a room tonight, Ill check be there in a hour" and don't hold there spot with a credit card #. If someone shows up at the resort without a reservation but is ready and willing to pay - then they will cancel that not guaranteed reservation and give it to the next person. Does that make sense?