polarbear - my son gave up on cursive and now uses the word processor for most everything. After years of OT, it didn't seem to be a battle worth fighting. I think you decided the same.
That said, abandoning cursive (and even printing) does come at a cost as you were recently reminded. Sigh, these things come out of nowhere and remind you of the barriers and challenges just as you are pushing them to the side. I agree with geofizz, as long as he can read it (even if he has to slow down and do a bit of deciphering) I say let the cursive go. At least this is what we have chosen to do w/my 14 year old son.