It's important to note, this won't save Muppets either. This generation of leadership seem determined to replace something one way or another. It's not just D'Amaro either, they were determined to replace GMR before him, it's the generation of leaders. If Muppets doesn't go for Monsters, it will go for something else. I believe that. I'm sadden by it, but I think it's a fact at this point.
On the plus side, there will be some charm with that area if they do put Monsters there.
FWIW, Alicia is saying that they will need to remove the brand new Mermaid show to do what's shown in the art if it's in the AC. In that case, either way, a zero height attraction would be removed. I think they could still do it there without removing Mermaid personally, but it is a bit messy since WDP also exits over there. There's also the Disney Jr. show to deal with. Muppets area would be more immersive because of that, in some ways, I get whey it's considered. I don't like it, but I know they won't let it go now that they're set on it.