Again I don't think setup.py is going away. Given that distsetuputiltools is a jenga tower of decades old monkeypatches documentation is understandably sparse, but they're at least passively open about how gross it is to work within. Subclassing or otherwise manually overriding the behavior of distutils classes like build_* is just how stuff is done at this level and I don't expect that to change, beyond just updating your stuff to subclass or hook direct setuptools equivs of existing distutils classes. distutils is already vendored by setuptools anyway, so you're already not really hitting 'distutils' as much as 'setuptools._distutils' aliased to distutils upon importing setuptools (and specifically importing it first ( https://github.com/pypa/setuptools/blob/c121d289da5d19cf6df2... )), so all this really does is collapse a level of hack.
As long as py2 remains supported I expect whatever changes happen here to be py2 compat, but I do expect new setuptools to break compat with old setup.py's. But setup.py being what it is it wouldn't be out of character to make your setup.py manually support both old pre-distutils-removal setuptools and new post-distutils-removal setuptools, but that's just how setup.py maintenance goes lol.
ed: ok well not so much py2 being 'supported' as 'no showstopping incompatibilities for anyone still straddling that ever widening gap' :)