It's not 'nothing', but it does seem like less and less is being done. I'd be totally fine with them taking off yet another dungeon in development if I saw the resources going elsewhere.

So far I don't see anything that shows they've been using the freed up development time, except perhaps to release more cash shop exclusive items than ever before. 3.1, while generally being frowned upon for diadem and LoV (I did enjoy diadem for a time, as an aside) I could at least see where the development time went when they downgraded from 3 dungeons per large patch to 2.

Perhaps it really is that squadron AI that took the brunt of the effort. Which... probably isn't going to be all that useful, for now.