Rick, as you know Cg is Nvidia's high level programming language for pixel shaders. Porting them to Cell, the PS3 CPU would make little since. I assume ZDNews's article meant the PS3's GPU, not Cell.
Unless my comment is true, which I doubt...
Also, my guess is that Metrowerks will be involved in Revolution's
tools. Considering that Metrowerks is used for N64, DS and GC development.