Nah, the movie falling through happens way back during the end of Phase 1 into Phase 2. It's mentioned in the Bananaz documentary as something Jamie wants but it all fell through with any studio.
Their falling out post-Plastic Beach was all because Jamie was mad that the PB tour became too focused on Damon and the guest band instead of the art. The entirty of Phase 3 did feel a bit disconnected from the Gorillaz characters, so I can't blame Jamie for feeling scorned.
Glad they made up and sucked each other off again.