The rumor about ET is new to me but makes sense. The long rumored updates to the "kid" section of the park would require ET to possibly be closed due to it's current entrance in the land during construction.
With a new, better themed entrance and bringing the ride into a new land, they can totally transform the current land into a complete "theme" without needing to tie ET into the theme to make it work.
It would also bring in more guests. I over hear a lot of people talking about not needing to go down that path into the "kid" section because it is just a playground and Barney. Putting the entrance to ET on a main pathway might boost the attendance numbers of the ride.
A part of me still believes it has to do with the two big anniversaries happening this year. Over the summer have a tribute to the parks history with stuff from Kong, Jaws, etc. Then close it down and retheme the building to a history of HHN since it is also the 25th year of that event.
I agree with Anonymous that it would help guest flow during the rumored Kid Zone makeover. There is an issue with the entrance going this way though.
How will Sponge Bob Store Pants and The Kid Zone Pizza Company receive backstage access during park hours if the proposed new entrance cuts directly behind them?
I still think a museum walk through attraction to celebrate the 25th would be a great temporary utilization of the space.
Was the Garden of Allah ever used for anything other than to provide atmosphere?
Why can't it be both? A museum of past attraction with the entrance of ET one of the past attractions.
As far as I know the Gardens has only housed a few small attractions over the years: http://en.wikipedia.org/wiki/How_to_Make_a_Mega_Movie_Deal
When I first visited Universal, this was "ATT&T at the Movies", featuring touch-screen trivia games, historical info, a working prototype video-phone you could test out, a big screen showing Universal trailers, and some sort of robot arm they were showing off. It was essentially a small hands-on museum, and as a kid, I loved it. Later, the place was used for storage and the exterior just always looked pretty.
I like the idea of moving the ET entrance out there by the road. Makes a lot of sense, and will help keep the new area theme separate, whatever they choose to do with the old Kid Zone.