The rodents ate some of the negatives to "The Gathering," but most of it must have been intact, since JMS was still able to re-edit it to create the special edition after making the rodent discovery. I don't think I've read about any further damage to the series negatives, but it's possible.
In any event, Babylon 5 has a limited (and diminishing) fan base, and isn't currently playing in syndication (wasn't it also pulled from Netflix streaming?). The lack of interest from Warner Bros. comes as no surprise, really.
This is a shame, really, as I'd pay a pretty penny to see the series in HD. Heck, I'd be happy to see it (again) on DVD, if they bothered to release it in its original aspect ratio.