I'm pretty convinced it did exist.
I doubt Em's team would be happy with Ca$his just chatting lies. He quite clearly wouldn't just risk doing that. Ca$his just said Em scrapped it all.
Which, a public news report confirmed - Em just didn't ever admit he was working on anything or about to release an album but he did scrap a bunch of material. Which he even says himself. And he says "Beautiful" is the only one from 'that batch' (King Mathers) he kept for Relapse.
Um, I dunno why you put "Elevator" there though. That's very much in his new style. Spitfire, energetic, lots of rhyming, psychotic, that was originally going to be on the 'original' Relapse 2.
As for whether it would of been better. I think no. I'm definitely annoyed I didn't get to hear it in its full form, I think "My Darling", "No Apologies" (and all Re-Up) performance, "Beautiful" and "Careful What You Wish For" are a good indicator to how it all would of sounded.
On the plus side, it was all Em's production, which I much much prefer, often using strings and dark echoey atmospheric sound to fully realize the vision. It would of been very slow, depressive... No doubt it would of been received better by some people just because of the "no fucking accent man!" and obviously better with critics since they're suckers for emotion.
But no doubt that in rap and technical terms, Relapse is better. I'm definitely glad he did go that way anyway. I wouldn't wanna be without Relapse and we wouldn't have Relapse 2 to come

Or we might but... The chain of events would of been different.
Should of released King Mathers in 2007, then he could of done Relapse 1 and 2... Although that bugs me because you can't ensure... Everything has a knock on effect, no idea what would of happened... I mean it could of spiraled him back into... Argh, hate shit like this. Okay, I'm out.