It's unclear what happened to Film Producers, Inc. ambitious project, but it's likely the Raboff and Cohen realized they had bitten off more than they could chew. The Longstreet script, as far as I know, has never surfaced.
In September 1951, Paramount reacquired the rights to the Kellock book from Cohen and Raboff when producer George Pal expressed interest in doing a Houdini movie. This time the result was the classic Houdini with Tony Curtis and Janet Leigh in 1953. The idea of a Houdini TV series would have to wait until 2016 with Houdini & Doyle.
UPDATE: Summary of 1950 Houdini Screenplay (Property of Film Producers)