Hi David,
Just the contrary!
The core elements of JavaConfig have been migrated to Spring Core for the 3.0 release. You can find @Configuration, @Bean, and others in the recently release Spring 3.0 M3. Take a look here to get a sense of it.
http://is.gd/JEXz
We'd love your feedback, please take a look and let us know what you think.
As for the JavaConfig project itself, it is right now uncertain whether we'll continue a separate project or eventually migrate everything into core. This will be based on user feedback with the 3.0 features.