I consider this more likely than you do. Bill is a match for anyone in the league as a GM. If he retires it will be because he can't keep up with the physical rigors of coaching anymore, but there isn't a football mind I would want as a driving force for an organization's progress, development and success, more than Bill Belichick. If driving a desk is what he's reduced to, I'd still expect Bill to drive it better than anyone else out there we could have instead.
I think it's very likely that Bill Belichick will have a lot he can give an organization from behind a desk even after he can't serve on the sidelines anymore. I would say it's possible, although not probable. It depends on how much he wants to take Ten Rings for a few nice joyrides and enjoy retirement -- and how much more he'd rather be the proud owner of a boat named Eleven Rings instead.
That said, the idea of Steve Belichick replacing him as head coach... would depend heavily on Steve Belichick being the best available candidate. Belichick doesn't seem the nepotism type, everything he's run in New England has been pure meritocracyso far. If he has his son on the staff, it's because he thinks his son is one of the best possible people to carry out his wishes for that position. So I won't rule it out, but I doubt he's the immediate successor.