Yeah, sorry I've been absent as well. Busy work week, but I have a day off now.
I don't think putting the attraction in DHS would be a bad idea at all; there would certainly be the room for it, and from a narrative standpoint DHS is (or was) traditionally the home of non-Disney properties in WDW for a long time. I think thematically in the Magic Kingdom the only place an attraction like this would make sense in is in Fanasyland. If we really wanted to go retro, we could say that Disney acquired the rights in the early 1980s and put it where Storybook Circus is now.