It seems he may return
http://uk.movies.ign.com/articles/115/1159203p1.html
I'm more hoping that he at least stays on as a producer for IM3. I know he's executive producing Avengers.
The Air Force dude in the first movie wasn't really needed for the second one but they brought him back anyway.I don't think it really matters. I think his acting appearance may be improved when he's not also the director (that way it's not the director putting himself into the movie) but at the same time Happy as a character is not really needed in this Iron Man-mythos. I say have Pepper and Rhodey as supporting cast but no one else. No Coulson, Fury, Hill or Avengers either please. Make it about Iron Man.
As for villains, I hope for Mandarin but I can see why it's difficult with all the mystical stuff all of a sudden. Just don't have another Armoured-up villain. So that rules out Titanium Man or Crimson Dynamo. Blizzard and Boomerang is kinda goofy maybe.
Living Laser is a character I'm hoping for as a powerful servant of whoever the main villain is, or as the main villain himself but then with a tweaked personality and grand ambitions. I could also picture Melter, but then his powers should be slightly different but with the same core idea.
Or AIM, they could be simply awesome as villain organization.
But most of all, I'm crossing my fingers: Go Mandarin.
I'd rather not see a re-cast. if Favreau's not interested/available, put happy on vacation, sick leave, something.. marvel's already lost terrance howard, ed norton, due to "hiccups" in negotiations.. more musical chairs in casting doesn't help..
I'd like for Fav to come back as Happy, I actually liked him in Iron Man 2,, though I don't think he'll come back... IMO
They're already doing costume fittings so I'd think he'd need to be there. Plus, he's a producer on the movie still and the filming is supposedly starting soon or already has so a couple more good reasons to be down there.THR confirmed his return, acting-wise, as Happy for Iron Man 3. Not just the Twitter pic, although I'm surprised he's already here in NC...
I'm glad he's back but he is a little on the tubby side right now
Must be eating his feelings since Tony & Pepper are together.