This is wrong actually - they've been using ray tracing for ages (all ambient occlusion in PRMan is done with raytracing, by sending out occlusion rays in a hemisphere around the shading point).
What's new with MU is they're using both physically-plausible shading (where the shading is based off physically-based BRDF lighting algorithms, which gives much more realistic results), and global illumination path-tracing for the entire light transfer equation.
Yes, because the article (and the person in it) doesn't seem to understand the difference between path tracing (ray tracing with global illumination - multiple bounces even with diffuse surfaces), and ray tracing = sending rays around a scene and bouncing them off specular reflective/refractive surfaces - which Pixar have been doing for years. It's been possible to write raytraced shaders in PRMan for over 12 years now.
No, the guy in the article was wrong - it's been possible to do in PRMan since at least 2000, but it was very slow (they didn't have any decent acceleration structures for the ray intersection), so it generally wasn't used that much. But it was possible.
For PRMan 13 (which Pixar used for Cars in 2006), they added semi-decent acceleration structures which sped up raytracing a bit. But you still had to use custom shaders to cast rays.
With PRMan 17, ray tracing is now a first-class citizen in PRMan, and it can also trace rays from the camera instead of doing the traditional (pre 17) REYES rasterization of the surface and then shading that surface for reflection based on ray tracing.
What's new with MU is they're using both physically-plausible shading (where the shading is based off physically-based BRDF lighting algorithms, which gives much more realistic results), and global illumination path-tracing for the entire light transfer equation.