Why replace the hat? Like the castle, Spaceship Earth, Tree of Life, the Hat is the central Icon for DHS and fits the theme of the park perfectly, Hollywood Magic and it's Mickey's hat as well, the most Disney icon of them all. The "return" of the Chinese Theater (as the Icon) has NO meaning, is not Disney, what is the point? The only point of the Chinese Theater is that it was there 1st (so what?)...as the water tower served as the temporary park icon. And like the other park icons, the hat provides for a GREAT picture, the alternative is a picture of your family standing with a fake Chinese Theater in the background (?!?).
And if your argument is that the hat doesn't belong on main street, neither does Cinderella's castle, or that it blocks the Chinese Theater which is part of the theme of main street, then I would like to point out that the Chinese Theater stands alone, there are NO buildings around it themed towards it and main street stops a block before the Chinese Theater, so again, it stands alone. It is a beautiful entrance to a great movie ride, but that's all it is, it is not Disney, and it is not appropriate as a Disney Icon (and if Disney ever used it as such, they'd probably get sued, which is why the Water Tower was the icon before the hat). The only problem is that the hat is so close to the Chinese Theater, that you can't get a good picture of it, but considering the hundreds of "iconic" pictures the hat provides...
There is nothing wrong with the hat except it isn't big enough to house anything significant. Make it bigger...