The step that's missing from this discussion so far is that any new edition can't just be focused on recovering lapsed players (even if it could recover
huge numbers of them). It's still a limited and diminishing market. A new edition has to bring in
brand new players, and it has to do so in numbers that we haven't seen in quite some time.
Now, I realize that this wasn't the point of the topic, but it's something that still has to be taken into account. Even if WotC
could produce a game to make most D&D players happy (for whatever value of "most" you care to use), it still might not be a successful or sustainable edition.
My gut feeling--and I'll be the first to admit that my gut probably qualifies as more anecdote than data

--is that, in the current market (and faced with competing forms of entertainment), an edition that could successfully bring in a sufficient* number of brand-new players would have to be, at its core, simpler than either PF or 4E, with optional add-ons for those who prefer more complexity.
("Sufficient" being defined as enough new gamers to make tabletop RPGs a viable and profitable hobby for another few generations.)
In order to create such a game, WotC (or whoever) would need to boil down
every edition--with a focus on 3E/PF and 4E, but at least some attention paid to earlier editions--and try to isolate the most fundamental core aspects that make the game "true D&D" in the minds of the players. You're never going to find a consensus on that, not by a long shot. But it might--
might--be possible to isolate a collection of core aspects that appeal to a
majority of the fans of each/every edition.
If you take these core aspects--the "essence" of D&D--and you create a game that's simple and has a low barrier to entry based on those core aspects, it won't be an evolution of 1E, 2E, 3E, or 4E, but rather a new game with some themes and elements in common with all of them. If it's done
really well, and if the company's been
very careful about determining what those core elements actually are, the result
might be a game that entices more lapsed players to come back than it loses
and attracts new players to the hobby as well.
Is that what Mike's doing? Trying to tease out the common elements of all editions in hopes of creating an uber-edition? I have no idea. I don't know if that's his intent, and I have no idea if it's even remotely possible.
But I think that's the only way to go in the long term. You're never going to make 4E appeal to people who still prefer 3E/PF, and you're never going to make 3E/PF appeal to people who prefer 4E. If you want to bring them back together, the only remaining option is a new game that appeals to both (or at least to a majority of both), that
feels like D&D to both, and that's a solid enough game to entice them away from the edition they're currently playing.
It's a tall ask, and I have no idea if it's feasible, but I think even the
attempt (whether by WotC, Paizo, or whoever) would produce a fascinating result.