I think that Chris Nolan will do the third film, but who knows how long it will be. Nolan is an artistic director. He knows what he wants, he knows what to shoot for, he knows how to get it. Story wise, he is a master craftsman and I think part of him would regret it if he did not complete his story. Sure, his story for Batman could've ended with The Dark Knight but too many arcs were left open. Joker? Batman on the run? The aftermath of a Dent-less/hopeless Gotham City? Just to name a few, those are pretty big unfinished stories that need to be addressed I think before Nolan leaves. I think he owes it to the fans and the audience who all went to see Batman Begins and especially The Dark Knight, but to himself for helping create one of the few best interpretations of Batman known in comic/film history.
Story is one of the main things that made people get drawn back into Batman now, the way he's been sort've redrawn in a new light for a newer generation. Forget the camp, forget the earlier 4 films, this is a Batman of a new generation, and one that'll most likely continue to go down in the history books if a third film is made with Nolan. Could it be better than The Dark Knight? Probably. But will it actually be better? Probably not. Nolan shouldn't focus on making something to top The Dark Knight, he should focus on finishing his trilogy and ending it in a way that would please the fans and leave it a little open for WB to continue to make sequels with this version of Bats. Who cares what villain it is, or who's playing the villain. Just continue to do things the way you've been doing them and the way you've been making them and you'll make a successful movie that hundreds of millions will flock to see and then you can gracefully walk away knowing that you're forever in the books for creating (probably what will be) the best comic film trilogy of all time.