I'll admit to not really picking up on that subtext when I first watched it, although I did find the homophobic joke from Tio out of place. Now that it's been pointed out to me, however, it does make sense.
Yes, but Vince Gilligan never commits to anything during these podcasts, opting instead to leave it all up to interpretation. If he was asked if Walt actually had cancer or not, he'd probably say it was 'up to interpretation'. Hyperbole aside, he admitted it was a possibility, and Kelly Dixon and the actors involved seem to believe that there was that subtext, and that's how Giancarlo played it (according to Steve Bauer, who played Don Eladio).