The area was what would today be called "unbuildable", and quite a bit of it was already "brownfields", unsuitable for human habitation. The soil is permanently saturated, and there is no underlying rock strata for some distance down, making piles only marginally practical. There are a number of old dumps, on which soil was just graded over, some of them not up to anything like Superfund mitigtion standards.
The street levels that are 15-20 feet below the average water level in the Mississippi and Lake Pontchartrain, are subject to seepage even when there is a low water level and no rain. The discharge pumps run continuously, like a huge sump, pulling the ground water out, and leaching a good deal of these contaminants already in the water away from the old dump sites. This discharge has been going into the lake and the river for decades, then eventually discharging into the sea.
Should New Orleans be rebuilt? Maybe, but not anywhere on these old swamps and bayous. Most places like the 9th Ward should be allowed to revert to a more natural state. Practically all the residents who once lived there are either gone, or dead, in the past week.
If New Orleans must get rebuilt on the scale that most people expect, then the landscape will end up totally different. I would be very surprised if parts of the city aren't raised, perhaps the greater part. Regardless, there will be substantial land set aside for parks, cultural activities, and public buildings. That's what I expect. The complexion of the city is likely to be totally different.
Of course, mine is the most optimistic view, but the precedents are supportive when looking at other large-scale planned communities in the U.S. and around the world. I suppose it's possible that it could all be a fiasco, but I doubt it.
And, for what it's worth, the political landscape as well will be forever changed in Louisiana. I expect it to become solidly Republican myself.