He's already on leave. So it isn't like there's a great strain on his health now. I would think no more than there will be when he remains on as chairman of the board. Which is the real point.
If health were forcing him to step down he wouldn't be staying on as Chairman. There are significant duties to being Chairman of the Board. You have to appear in public, you have to go to official functions, and so on. You can't hide a serious illness and still be chairman of the board.
Mark my words: This is all about Tim Cook (Which, if I might toot my own horn, I predicted here: http://tomstechblog.com/post/Ie28099m-Not-Sure-Steve-Jobs-Is...)
Being a Chairman of the board is a message to stockholders: "Don't panic, I'm still available", if he stepped down without an orderly transition Apple stock would probably really take a beating.
The chairman of the board is fairly invisible from a public point of view.
Of course it's about his health.
On the offchance that he did stage a miraculous recovery and decide "Well shit, now I'm all better I think I'm gonna go buy a large tropical island!" he would have mentioned his miraculous recovery in his letter, since his health problems are well known.
However, "I could no longer meet my duties and expectations as Apple’s CEO" is not just that.
"Could no longer meet my duties" + pancreatic cancer = a strong chance that the doctors gave him a number of how long he had left to live, and it wasn't it years.
(That doesn't mean that Jobs can't beat the odds, of course!)