One thing about Duffy and Build-A-Bear is that outfits are interchangeable. At the
D23 Expo this year, they were showing a line of really cute Duffy wear (including Halloween costume-type clothes where he can be a character from the Pooh series - my Duffy got a few of those also - available on the Build-A-Bear website). Not sure which size Duffy the clothes fit - I'll have to measure mine when I get back to him - he's at my mom's house and I won't be there until the weekend.
I wouldn't bet on Duffy going away - Disney has made a big investment in him. They realized that kids love Teddy Bears (and us adults, too) and Disney didn't have a signature bear. He's only going to get bigger (I'm sure the Duffy DVD is being shot in 3D as I'm writing this).
I think it's interesting that so many kids aren't into the DUffy-on-a-stick. Maybe if enough parents let it be known that it didn't work, they will go back to the masks. Or maybe offer both - it can't be that hard to do.