As far as engines are concerned, Nintendo has licensed so many for use internally by 1st & 2nd parties, and externally for 3rd parties, that I would be surprised if they were really creating an engine from scratch, as the article made it seem more like they may have been tweaking an existing engine (such as UE4) to work with the Wii U and then showing other developers how to get the same results.
[edit: On second thought, I guess it's possible that Retro could have made an engine so nice, that they showed other engine creators, such as Epic, that Wii U can infact do most, if not all, the same effects they thought it not capable of doing, and therefore convinced them to reconsider their stance on Wii U support.
Really makes you eager to see exactly what it is that Retro is actually working on right now]
Rumor from before was that Nintendo was in constant back and forth talks with Epic about UE4 and there was some tweaking going on. Maybe it wasn't just final hardware specs that Nintendo was tweaking, but also engine code for the rough build of UE4 in an attempt to show Epic that with some official support, Wii U was capable of some amazing results.
Now I can't say with 100% certainty that UE4 is being supported officially by Epic on Wii U, but besides Caterkiller and his source, another source has shown me a little evidence that Wii U is officially supported as of earlier this year.
So regardless of whose rumors you decide to believe, it seems pretty clear to me that Nintendo is pretty serious about lowering the bar of entry for everyone when it comes to developing on the Wii U (we need all those 3rd party ports and support in general), so expecting that they would go above and beyond to convince the most popular 3rd party engine of last gen to get on board with the Wii U seems very plausible to me.