We're told the mash-up mechanics make for a "really good" game but are proving to be a "licensing nightmare" when dealing with the music labels. As a result of the merger with Vivendi, however, Activision Blizzard now has direct access to the Universal Music Group.
Other than "DJ Hero," Activision Blizzard has trademarked a number of unannounced music products that have yet to come to fruition, including the games "Guitar Villain" and "Drum Villain." It was later confirmed that the "Drum Villain" development was rolled into the company's upcoming band-oriented "Guitar Hero: World Tour."
More through there, if that floats your boat.