Update (27/6): Distler, who actually went to Witten's talk, says, "But the main insight, emphasized at several points by Witten in his talk, is that the gauge theory approach is wrong." The slides make an interesting reference to a Farey tale.
And Lubos may have a point when he says, "Well, I happen to think that if Edward Witten started to work on loop quantum gravity, as defined by the existing contemporary methods and standards of the loop quantum gravity community, it wouldn't mean that physics is undergoing a phase transition. Instead, it would simply mean that Edward Witten would be getting senile. We all admire him and love him, if you want me to say strong words, but he is still a scientist, not God."