Just read about this on Screamscape. Lance seems to think this isn't for Seasame Street, but I'm not quite sure why he thinks that.
I’ve also heard a rumor that those previously plans have been been cancelled instead, as the public wouldn’t have been fooled so much by a re-paint of the old Dragon area as a Sesame Street land, and the reaction to the entirely brand new area created at the Williamsburg page has been very positive by contrast.
To which my obvious thought would be: Okay then, they're going to put in Seasame Street as a whole new area and keep Land of the Dragons, too. Yet he leaps right to the idea of a whole new (adult) coaster, and I'm not sure why.
/Wishful thinking, perhaps?