I think we're in the dark on villains still. Nolan put the Bane and Catwoman thing out there to quench the thirst of the fans. I think we are going to see the most villains out of any Batman film in TDKR. I don't think there is a great possibility Two Face is included but I do think the main villain hasn't been cast yet. I think we'll see Bane, Catwoman, Hugo Strange, Black Mask, Scarecrow, maybe Two Face and a few others here and there. I don't think Bane will be the Joker of this film, I think we'll see him in a Scarecrowesk roll from Batman Begins. Nolan has handled multiple villains perfectly so the more the merrier IMO.
The thing is NO character's arc suffers in a Nolan film. People say Harvey Two Face's arc suffered in TDK. Thats dead wrong. It had all the elements of Two Face from the comics arranged in a way that made it original and fit for Nolan's world. We still got the court room scene, the half/half suit, the scarring, the coin, the insanity, the revenge ect ect. but in Nolan's own way. Yeah he wasn't running around the whole film with his face burned off yeah but how much further could you of brought that arc? If they really were planning on Two Face returning for TDKR, why would you tell everyone in the last scene? You wouldn't. You wouldn't tell anyone until the trailer or the film came out. He left that scene ambiguous on purpose, he's methodical, he wouldn't intentionally make that death scene vague if he didn't want it to look that way and if he goes around to all the interviews and says, "..yes, it was meant to be vague" that opens the Nolan curtain up a little wider than he wants and he would never tip his hand like that. While it's been debated to death (no pun) and multiple people confirming a fake character is dead in a fictional film there is always a chance it's all a swerve. So lets not put a definite on that character being dead yet. Until the series is finished we won't know.
http://www.youtube.com/watch?v=08jw37WwBlA