Yep. Gatti has been on the slide for some time, and after the humiliating beating which Mayweather gave him he can no longer be considered credible opposition for any fighter with pound for pound pretensions. Cotto on the other hand is another young, hungry fighter with a perfect record and a couple of respectable names on his record. He's a very credible opponent, and of the three big names at 147 (Mayweather, Mosely, Cotto) he's also the one Hatton has the best chance against. It would also be an absolute war, because both men are skilled brawlers rather than finesse boxers. There wouldn't be much in the way of speedy defence and counterpunching, but there'd be a whole lot of trying to knock the other guy's head off.
On the Mayweather-Hatton thing:
It's an incredibly attractive fight. Both are unbeaten and still in their prime. Mayweather is the man in the 147 lb division, Hatton is top dog in the 140 lb division. And for the first time serious money is available for this fight. Mayweather has much more name recognition from the general public than he had when he first hit the top of the pound for pound rankings. Hatton is suddenly much more credible after soundly beating his second top tier opponent, and has built a huge following in Britain.
There are plenty of reasons for the fight to happen, but also plenty of reasons why it might not. Money first of all. Someone making unreasonable money demands is the single most likely thing to kill the fight. Location is then a big issue - Hatton will want to fight in Britain, Mayweather, as the more highly rated boxer will see no reason why he should fight in the other guy's back yard. The referee will be a big issue - Mayweather will want a ref who actually referees and doesn't allow Hatton to wrestle.
Weight is another crucial point. Mayweather has just beaten De La Hoya at 154 lbs. He trains constantly and came in well under 154 for that fight, so he could probably make the limit two divisions down, but I doubt very much if he'd see any reason to do so. 147 is his preferred weight, he's the more highly rated boxer, why the hell should he drop two weight divisions to suit Hatton, particularly when Hatton has recently fought at 147 himself? Hatton on the other hand is already one of the physically smallest boxers at 140, which only becomes more of a disadvantage at 147. There's no way he would want to fight Mayweather at a weight where Mayweather's natural size advantage is emphasised. There's also the fact that Hatton's fight at 147 was widely regarded as the worst performance of his recent career.
I'd love to see it happen, but I won't believe it until I see it.