I think it all depends on what they do with their roster.  Right now Felton doesn't have the right kind of players around him to be very effective.  Raymond is a drive and kick player and there's only one guy who has catch and shoot abilities in the starting lineup(Richardson).  Wallace can score but his release is normally too slow to get a shot off when he's set up and normally does his work with the ball in his hands.  He doesn't move without the ball much so he's kind of a mismatch for Felton.  Wallace can be a good creator as well, but since Felton isn't too much of a shooter its not very effective.  The Okafor and Mohammed combo is also a mismatch for Felton(or anyone for that matter) since they are two guys with very similar skill sets: pure centers who have trouble finishing plays and catching passes while in motion.  Nazr can hit an 8 footer from time to time and Emeka has no jumpshot at all.  While Gerald Wallace was injured last month the Bobcats posted their first 5 game win streak and I personally think that having another catch and shoot guy(Matt Carroll) out on the floor made the offense runs much smoother than having Wallace out there.  Obviously, Wallace is a more talented player, but the Bobcats desperately need jumpshooting.  As the lineups are now, Felton has a very hard job, I think alot of the criticism he's received has been uncalled for. 

I don't think the Bobcats will be a very good team until they address a few key issues.  Obviously the Bobcats have talent but the players aren't complimentary to each other.  They need a big man who can score and hit a mid range jumpshot.  Emeka is a bit undersized at the 5 on the defensive end and finding a center with reliable scoring and shooting abilities to compliment him would be tough.  They should have made a move for Gasol.  On the other hand, the Cats could definately make a move for a PF who has those qualities and keep Nazr at the center spot.

Another issue is shooting.  Felton needs shooters around him.  At least 2, but 3 would be best.  With Gerald being injury prone and lacking catch and shoot abilities, I think it might be a decent idea to think about trading him as well since he, like Emeka, has pretty impressive numbers and could possibly be good bait for a piece that fits better.  Having a SF who can't catch and shoot can be a bit of a liablility, especially when your 4 and 5 aren't gifted offensively.  If they could move those two and get an offensive minded big like a Jamison/Brand type, as well as picking up a big time shooter like Mike Miller or even Ben Gordon and maybe another shooter in the draft, then they would be headed in the right direction.  With pieces like Wallace, Okafor and a lottery pick for trade bait, they should be able to get some more complimentary guys and improve the team greatly.  It would be hard to convince the front office to move players who put up good numbers, but it isn't always about talent, its about chemistry.  If they hold onto this core, Felton will continue to struggle as will the team.  In that case Felton isn't worth it.  If they build a well rounded team with a scoring big(and hopefully May can return and be effective) and some more shooters then Felton could be an elite PG and the Bobcats could be a force in the east.  In that case, he's worth it.  A new coach would help out no matter what happens.

I'd wait to see what moves they make before doing anything with Felton's contract.  Signing him to a big contract would be a bad move if they don't plan on making some big changes.