As of last week there was no sign of a foundation. They put in some pilings and some drainage, but other than that its a big, flat dirt area.
And reports are that the construction signs that mentioned "Contemporary Suites" had that part painted over...so its all just a guest.
CMs have been repeating the same rumors we've all been hearing, although they do tend to state them as fact. But then again, Disney itself has stated many things as a fact that never came to be...Africa Pavillion in the World Showcase (on the EPCOT Center opening special), the Asian and Venetian resorts, etc.
Fact is plans change. What may originally have been planned as DVC at the Contemporary could be in flux as they decide what it is they really need.