I notice that in the Fall of 2007 that NCL is repositioning the Dawn and the Spirit and replacing them with the new Gem. That means only one ship will be sailing out of NYC. Are there any NCL plans to bring in a second ship? Is NYC a smaller cruise market than originally estimated?

I think the reduction in the number of NCL ships from two to one during the winter has more to do with other cruise lines sailing cruise ships from the New York area during the winter.
NCL was the first to sail from New York during the winter, and when they added the Spirit also, they were still the only cruise line sailing from the New York area during the winter. Next winter, when NCL repositions both the Dawn and Spirit to Miami or New Orleans, NCL still plans to sail the Gem from New York. Other cruise lines will be too. To be precise, besides the Gem sailing from New York this December, you can add Holland America's Noordam, Cundard's Queen Mary 2, and Royal Caribbean's Explorer of the Seas. All three larger than the Spirit, two of them half again larger than the Gem.

So, next December, four cruise ships will be sailing from the New York area, vs two this last year. This winter, the passenger capacity (double occupancy) was 2,224 (Dawn) + 1,988 (Spirit), a total of 4,212. Next December, the passenger capacity will be 2,384 (Gem) + 2,620 (QM2) + 1,918 (Noordam) + 3,835 (Explorer of the Seas), a total of 10,750.

10,750 is times more than two and a half times more than 4,212. I believe NCL's reduction of ships sailing from New York area during next winter is just an attempt to keep fare prices up, as that market might be saturated with empty cabins next winter.