Yes, Cain is still the number 2 heavyweight and definitely a force to be reckoned with. If anything, I think he is probably the fighter with the best possible skill set to dethrone a champ like JDS. But despite that, his chin hasn't been shown to be particularly bullet proof. That's a problem when the number 1 and 3 guys in your division are the preeminent face punchers of the world. He also seems a bit undersized to me, but that might be debatable.
While Cain might not be a guy like Fedor, who could very well make the cut to 185 if he was dedicated, he is certainly far from the biggest guy at HW. He has always been fairly soft, and against JDS, he looked downright fat. He wouldn't even be one of the larger guys at LHW, so I think this cut would be possible. And honestly, I think he would have the tools to beat Jones.
What would he bring to the table against Jones? If Brock Lesnar can't keep you on the ground, I don't think anybody can. Cain has shown that his wrestling is superb, and in a fight with Jones, I could see it nullifying his greatest asset. I could even see Cain getting a few takedowns of his own. Also, I think Cain would probably hold the advantage in the striking area of the fight. His kickboxing is solid. He would probably brutalize Jones with leg kicks, and certainly has the type of speed and power to hurt Jones on the feet.
I know this is purely speculation, and that heavyweights rarely seem to want to move down in weight. However, if you read tomorrow that Cain was going to drop to LHW and was looking to make a run at the title, could you say you wouldn't be excited?