According to Variety, MTV are definitely not publishing the game as was rumoured. MTV's official statement after being asked directly is that they aren't publishing the game, and that:
"We are big fans of Tim Schafer. We hope the game finds a good home."Meanwhile, rumours are thundering through the internet that Electronic Arts may be taking Brutal Legend on board. This doesn't match up with an insider source's earlier comment saying that the publisher would be an untraditional one, but it's very possible the aforementioned publisher was MTV and negotiations simply fell through.
Once known for dismal working practices and unoriginal release schedules, EA has been working very hard recently to change how they're perceived by generating new, original games. The upcoming Spore and Mirror's Edge are a testament to this, as are recent outputs such as Mass Effect and Crysis.
No other publisher could market Brutal Legend as aggressively as EA, so I'd be very much open to seeing the game join the 'new' EA and its line-up of quality games. It is by far the best chance Brutal Legend has of hitting the kind of widespread exposure it most probably deserves.