Working in that area of Cardiff at the time, the impression I had was that the plan was to remove the embankment and bring the railway down to street level, not to get rid of it altogether. However the developers of the posh, expensive new flats on the eastern side rather liked the idea of a physical barrier between them and Butetown itself, so the embankment was kept. Can't have ordinary folk just wandering across to our shiny new developments, can we?
I certainly read that there were plans to abandon the railway line to free up land for development on the grounds that it wasn't needed because everyone could catch the number 6 bus instead.
Whether that was actually true or a misunderstanding is another story of course...