I honestly don't know, but I'd love for the third one to come out. These are by far the most enjoyable XBLA games I've played, along with N+ and Castle Crashers. I'm having more fun with the Penny Arcade titles than with many retail games. I like the bite-sized RPG adventure style of the game. It isn't too complicated and it keeps things fresh and fun. I really Like the combat, simple but deep.
Hothead Games is the company that made these titles, and currently they're working on several projects. From what I know, a project called Swarm, as well as helping to bring Braid and The Maw to PC. I hope they come back to make a third game, because I greatly enjoy them. At first, the $20 price tag turned me off, but I bought Episode 1 for $10 during the Deal of the Week and after beating it I immediately picked up the $15 Episode 2. After playing them, I would definitely pay $20 for a third installment. They give you a lot of play time and a genuinely great experience.
I really want Episode 3!
A GREAT GAME!!
