Flash is in no danger of replacing magnetic storage media.. It is still much more reliable than flash, and outperforms it.
The next logical step for hard drives will be designs incorporating solid state electronics, so while the drives might resemble what we've come to know as things like flash/thumb drives, it will be on a whole different scale.
As for flash being used for caching... Good luck with that, because it might have a fast access time, but that doesn't mean jack shit if your throughput bottlenecks performance. It would probably be cheaper per MB/GB to throw an extra RAM slot on a motherboard and buy a stick of ram to form a dedicated cache bank