I heard the Jane's rumor too. There's more evidence to support MMJ at this point though. MMJ (and Jane's, and Grace Potter, and Bush) all played Beale Street this year which is booked by the same people that book BayFest. MMJ plays Southland in Nashville that Saturday. Nashville to Mobile shouldn't be that difficult to maneuver. Plus it'd be really interesting to see Jane's play BayFest after they played DeLuna last year.
Either band would be a real step out there for BayFest (especially MMJ). There would be A LOT of hating going on in Mobile because Mobile is a way force-fed mainstream place. But an MMJ booking would bring a load of people in who would have never considered BayFest to ever have been a viable option, and people means $$$, and maybe more diverse future lineup changes for BayFest in the future.
On a personal note, I have never seen MMJ. So as much as I love Jane's Addiction and would be stoked if they came, I'd be even more stoked for MMJ.