When researching it's always best to go back to "primary sources" (learned that when doing historical research papers). After perusing some ancient KFOCF quarterlies, I think I've found the original source of the rumor- from Spring 1960:
"The son of the late Howard Darrin is reported to be producing these familiar automobiles in limited production in California at a cost of $5000. The only basic difference is the Cadillac "mill" in place of the basic Willys engine. "
Then there is the letter I found from Ted Dahlman, who visited with Dutch in 1964, asked him about the Cadillac Darrin and revealed the results to the club (see third paragraph):