Quentin Clark announces in his blog that select technologies from WinFS will be integrated in ADO.NET 3 and Katmai (next release of SQL Server), but WinFS will no longer be continued as a separate product. That means that there once again will be no relational file system in the foreseeable future.
Wild guess: WinFS has been a pet project of Bill Gates. Doesn't seem to be one of Ray Ozzie.