I think the optics of the 50mm f/1.4 are pretty good, especially considering how old the design is. Sure it's a bit soft a very large apertures, but then most if not all of these lenses are. The biggest problem with it is the autofocus and the USM micro motor, which makes it the most unreliable lens in Canon's product line.
I can't envisage Canon putting IS into a 50mm prime, there's no market precedent for that, and a lot of people like their primes because of the light weight, IS would negate that advantage.
This is a CR2 rumour so it carries a bit more weight than the usual gossip which does the rounds.