I will be surprised if a new 1020 is not imminent. The device is essentially on clearance right now, and I'm not sure why they'd do that if they were not planning on releasing a new version.
The 1020 is clearly the device where they can differentiate and bring in some "premium" iOS and Android customers. If they can make major improvements on some of its weak points, namely camera start-up and shot-to-shot times, and make incremental improvements everywhere else, then this will be a VERY compelling device to consumers that place a lot of value in their phone's camera. It's not going to sell like the iPhone or Samsung flagships, but it will generate excitement and sell decently and convert some iOS & Android users.
BTW, I snagged the 1020 for $339 from ATT. It's my first Windows Phone, and I'm pleasantly surprised by the quality of the OS. The "app-gap" is real, but I use a pretty limited number of, mostly, very popular apps and WP has them all except WatchESPN. They don't have a number of games I used to play on my iPhone 4, but that's not a big deal to me -- I've found different ones to waste my time with. There's also a couple of areas where WP is a little rough around the edges, but nothing too big. The biggest positives so far: the Nokia Camera app is vastly superior to the iOS and Android camera apps. Here+ navigation is superior to Google's Nav, especially when you factor in that it can function off-line (I don't have a data plan). The live tiles is, BY FAR, the most attractive phone interface. iOS and Android are just a sea of icons, and really not that interesting. Cortana is also very good - on par with Google Now, which I also like.