Or are you just talking about the statement Tretton made? If that's the case, of course Killzone 3 is in development. It will be some time (around E3, probably) until we see it, though.
I don't think you can really get hyped up over Jack Tretton saying "It's coming". It was pretty much an inevitability that Sony would round out a trilogy.
It's too soon don't you think? How could they have possibly made a quality game in such a short period of time... Well I guess if it's released 2011 with motion controls that would be okay.
Sure, like this is news? Anyways, it will probably look pretty much the same as KZ2. It milked the PS3 hardware for graphics, and it hasn't been made to much improvement on optimizing the software. But it will probably kick ass either way.
To be honest, an announcement at e3 for it to come out early 2011 isn't to soon at all. That's 2 years, like most franchises seem to go. They have the engine/graphics and everything nailed down, so this time around they could focus on everything else.
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