It would be a shame if we see this put on hold again. They've shelved the ATH extension so many times now I wish they'd just get on with it.
If they made this as a Spa Hotel then it will be its own product, so I think they'd go ahead with it. The Spa does pretty well.
The Spa really needs a big refresh and upgrade anyway, especially as this new extension means they are getting rid of the conservatory seating area. The changing rooms at the spa are mouldy and unfortunately it doesn't look like they are going to go ahead with the spa refurb.
But you are right, if they got the spa right they could push a lot of these rooms for spa breaks, particularly during the winter when the park is closed.