Regardless of whether or not this specific speculation is true, I imagine it's only a matter of time before the conference expands (which, in a way, is unfortunate because I like the round-robin schedule, no matter how much it puts Iowa State at a competitive disadvantage). When it does, I think Cincinnati is a slam dunk for one of the spots. Size, geography, endowment, and facilities are all working in their favor. Fan support is a bit tepid, but not terrible, and you'd figure it may increase playing in the Big 12.
Who gets the other spot (assuming we stop at 12) is going to be very interesting. BYU and UConn would add the most money and have the best fan support, but are pretty far flung geographically, and there are cultural "fit" issues to consider with BYU, as well.
Memphis or USF/UCF would be the long-term investment options for the conference. Memphis would fit nicely within the geographic footprint and has a ton of potential room to grow (especially with FedEx in the area providing possible funding). Gameday facilities aren't a concern, playing in the Liberty Bowl and the FedExForum. Both USF and UCF's enrollments have skyrocketed, and if their growing alumni base gets more emotionally/financially invested in their sports teams, they could be very nice additions, but again, a bit outside our existing geographic footprint.
I don't see Colorado State or Boise State happening - both have pretty significant negatives to overcome (geography for both, facilities and fan support for Colorado State, academics/size/money for Boise State). Northern Illinois, while a nice location for the conference to expand, simply has too much work to do facilities/fan support-wise to merit a place in a major conference right now.
Houston would also fit in well from a location aspect and definitely has a lot of growth opportunity, but I don't see the conference adding another mid-tier Texas school. That also crosses SMU off the list, who would definitely be behind Houston in the pecking order. Tulane, while great academically, is not a realistic candidate athletics-wise.