I believe this information to be accurate, and I also posted it under the other CR thread. Yes, the North Wing is to be torn down and a 5 story DVC building to be constructed. The update is stalled because the furniture is being manufactured in an area of the country which was hit by the hurricanes, and now the manufacture of said furniture had been delayed. Hope that helps, got a tour of the new rooms this week, looks great!
Was just at WL this past wknd and when we passed by the CR to get to MK via boat it looks like at the moment they are working on the South garden wings.
As for the DVC being built....last I heard it was still just a rumour but I supposse only time will tell. As a DVC member, I have yet to hear anything official though