More puzzling than losing Muppets, I wonder why they'd double down on geographically driving a wedge between Star Tours and Galaxy's Edge. If they were going to ditch MuppetVision, I'd expect it to have the goal of bridging that gap.
This was my logic in thinking it would be Animation Courtyard or even the RNRC area. Putting something like Monsteropolis there locks out an existing part of the park for a GE expansion.