Over the past few years I have been updating CDHK for the S3IS at regular intervals.
By current technical standards, the S3IS is now considered an old camera. I check the CHDK-SVN autobuild download site regularly for updates applicable to the S3IS. Is it worthwhile continuing the S3IS CHDK updates or alternatively keep the S3IS as a backup camera and purchase a new primary camera?
Your choice. Some CHDK improvements are applicable to all cameras, some aren't.
I was considering purchasing a DSLR. The Magic Lantern project is in its early stages. Are there any intensions that the CHDK developers will fork the Magic Lantern project for CHDK membership use and keep the development on the CHDK forum?
I don't follow. Forking is what you do if there are irreconcilable differences in the way the code is managed or the direction of development. If any CHDK developers wanted to contribute to Magic Lantern, I'm sure we'd try to work together first. All the current developers have limited time to work on this stuff, making extra work for no good reason is not high on the list of things to do.
Speaking for myself, I don't see contributing to DSLR development unless santa brings me a DSLR