actually the merge was very very common from early 90s to early 2000s. Most of Dreamworks' 2D era reflects. The background elements of Prince of Egypt is 3D [such as moving clouds]. Sinbad was most visually obvious of this merge compared to El Dorado and Prince of Egypt. Spirit was also a tad more noticeable!
Then as mentioned Disney's Renaissance is full of it. From Tarzan, Hunchback, Atlantis, Treasure Planet, etc etc.
3D became more prominent due to the "cheap" nature, success of Pixar films and Shrek franchise, and the belief that the market works best under the "new age art medium".
There is also less noticeable films on the market that branches into 2D. We dont have a Don Bluth of our era...yet!
Animation goes through trends just like any other part of the film industry. From what I've gathered 2D is alive in the UK, India, and Asia. Look at the successes of Cartoon Saloon [secret of kells, song of the sea], Ghibli, etc!
I doubt 2D will fully "die". Just as fashion resurfaces, so does art and animation.