But a good portion of Pathfinder's business is selling Core Rulebooks. D&D 4e should still be selling, especially the PHB and related Essentials products. Years after it went out of print, the 3e core books still pop-up on amazon's bestseller lists. And until D&D5 is released, the 4e books are still the easiest gateway to the hobby and *should* be selling at roughly the same rate in 2013 as they did in 2009 or 2010.
At least according to ICV2, Pathfinder has been outselling D&D 4e for most of 4e release period. I'm not saying that will be maintained with the release of 5e, but WotC/Hasbro seems to have been doing a fine job of toppling itself on its own from its marketing gaffs and more. I'm sure 5e will sell fine at least upon release, but over the long haul I don't know if it will keep overselling Pathfinder after release. We'll have to wait and see.
I have to disagree, since DnD Essentials (and a decreased release schedule), Paizo has gained ground and took the top spot (but it should with Hasbro's mismanagement). As a retailer for 15 years in the business, DnD is still selling strong.
The main point is only ICV2 and this survey posts any kind of retail report regarding sales of RPG products - at least they are legitimate. There is no other source of information out there - aside from anecdotal points of view. Nobody is saying anything to the contrary...
Actually there's at least one perfectly good source of data "out there." Nielsen Bookscan. It's also vastly more reliable than the IcV2 Survey, because it isn't a survey - it actually involves items being scanned as they are sold and the data sent back. That's where the sales charts in various newspapers come from. Now, you'd have to pay for it, but it's a perfectly legitimate source of data, even if it is one which only considers part of the retail sector (book stores, specifically, just as IcV2 only surveys hobby stores). Any RPG sold as a book through normal book stores will be counted in that. Arguably there's other sources, Amazon sales ranks, DriveThru sales ranks, etc, but they're less easy to interpret.
It depends on what WotC means by releasing a setting. If what they mean is what they did for 4E (i.e. a large-type/lots of white-space campaign book, a player's book and an adventure - and that's it), then Paizo has nothing to worry about.
All that said, I really don't think Paizo cares where they rank as long as they meet their revenue goals, which are likely much, much less than WotC's for D&D.
There are times I wonder how many people at WotC are on Lisa Stevens payroll. All credit to Paizo - Wizards have made the worst marketing strategy for D&D I'm aware of (don't put out any product) and Paizo have capitalised magnificently.