Having discussed the trail with EBRPD people at a "roll and stroll" event in Niles a few years back, it seems feasible to me. Costly, but feasible. Portions aren't very costly, but getting only portions done in that canyon is pretty useless. I'm not sure it is feasible to get the funding any time soon.
It seems unlikely that it will happen before I die, but who knows, maybe I'll still be cycling when I hit 100 and the trail will be done.
Except for a couple of "roll and stroll" events when the canyon was closed to motor vehicles, I've only ridden Niles Canyon once, and that only from Palomares to Sunol. It scared the snot out of me. It is a really enjoyable road when there are zero cars on it. A trail would be great. But I'm willing to bet a lot of money it won't happen in the next 20 years.