Well, according to this article, Steve has not only seen evidence of DNF, but has seen the game itself.
To be honest, I thought the game's supposed existence was a vast conspiracy. More than a couple of times over the last decade I have gotten vague invitations to come see the game "someday," with it never happening. I figured this was probably the same invitation other developers in the area had gotten, and were claiming that vague invitation as having actually seen the game.
I'll still believe it when I see it, especially the part where it stands out from the crowd. I'm not convinced that DNF will be relevant anymore. Though at this point it's almost ready for the retro period...