Does Kane deserve it? I believe so. He's always stood in the shadows of 'Taker, and others, but like 'Taker, he's been diehard dedicated to the company, working hard to put over a lot of guys and never wanting more than midcard titles. He's worked with loads of tag team partners over the years, working to get them over, and has put over big names in his time. He's got some damn fine matches out there, if you appreciate the style, and he's always been an easy main event fill in when he was called upon. He works a great face or heel, and I think helped ECW with his time there. So in short - yeah, he deserves and would be a good World Heavyweight Championship.
Will he? No, for one major reason - he doesn't want it. He's like an HBK - he goes out there, does his job, has a good match (not nearly as good as HBK's, but I digress) and in the long run puts a guy over.
I wish he'd take one, honestly. Him wearing the WHC for a few months would be a great "thank you" reign, and would be a lot of fun for SmackDown, but then, I think what he got with the ECW title is destined to be his "thank you". He may yet wind up with the IC title from Rey, and hopefully he does, Kane's always a great IC champ.
Kane's been a big part of the WWE for a long time now, was one of its best characters in the old days, has produced a number of great matchups (though certainly, they're not all great), and yes, in terms of deserving it ad having the potential to succeed at it, I'm all for a Kane WHC reign. But the fact is, the guy has never wanted it, and will probably continue to do what he does best - occupy the midcard and give other guys a nice rub on their way up.