A story over at Bleeding Cool reports that Downey will not only be playing the kindly old woodcarver Gepetto, but will also take on the role of Pinocchio. It's unclear at this point whether it will be done in performance capture or if Downey will merely provide voice work, but either way it's an interesting move that will set this version of Pinocchio apart even further. The script was initially written by Bryan Fuller (Pushing Daisies), and was recently given a rewrite by Jane Goldman (The Woman in Black). It's said to be fairly ambitious, with new material developed that would be much darker, in keeping with the tone someone like Burton would have appreciated.
The project is still set up at Warner Bros., and we'll hopefully learn more on its progress soon.