Okay, I have a friend who was in the production and here's his version of what happened:
The show WAS supposed to be taped for television but the enconomy tanked and box office revenue slipped dramatically, forcing the show to close earlier than anticipated. That negated the taping. There were hopes that the production would move to London and it might be taped there, but that fell apart, too.
It's sad because if any show in recent years should have been preserved for generations to come, it was GYPSY.
"Long live God!" (GODSPELL)