Check the comments on thestormtrack.com, Rita seems to weaken because it's approaching land and dry air, the water is also less warm. The eye seems to be very instable.
Thanks for the link. And they've just posted a story "Water Cascades Over New Orleans Levee". (See my comment below)

"Water poured over a patched levee Friday, cascading into one of the city's lowest-lying neighborhoods and heightening fears that Hurricane Rita would re-flood this devastated city...

It's already happening!