No the idea hasn't died yet and I doubt it will (athleast not anytime soon).

We are currently in the process of discussing what features we want, what programming approach will we use etc.
Now some may think "Planning! Why do you you need much planning? Why does it takes so long? Just start coding already and give us what we want!".
Well the thing is that when you are working on a project on your own you can usually just start without much planning but when you have a group of pepole working on nay project you deffinitly need planning so that those pepole know what should be done and who is wokring on which part. It wouldn't be productive if you have multiple pepole working on same thing each in its own way or if you have bunch of pepole working on not so important parts but there is noone working on cruical part that would combine all those tings into one neat system.

Anywhay I belive we are we would be able to start programming soon.
But since making a game engine is nowhere an easy task don't expect us to have ready product shortly. How much time will it take us? Nobondy knows.