There are legal issues involved and, as with so many things, money will probably be the only solution so the people who put together the "Cabal Cut" as it is known are showing the film here and there and basically soliciting for money everywhere they can (I believe I heard they may do some crowdfunding thing or something). Morgan Creek, the original production company, apparently gave them limited permission to show the movie for this purpose. Clive Barker is in full support of the project, though.
But, there's been no real concrete news about when and if it is being released in any form.

Oh, and the folks doing this cut have apparently also been farming around an idea to networks about doing a Nightbreed TV series, but again, no real substantive news about that either.

It is deeply stupid, but the mystical city of freaks idea is appealing. Also, you can't eat lithium like boon does. It'll kill you. I always so dered if the whole thing wasn't a fever dream of boon dying of liver failure.

I never considered this a very good movie and always wondered what the book was like (but not enough to read it). I loved Weave World and Imajica, so always imagined the book would be bigger somehow, more... not this?

It's actually fairly accurate to the book, though it makes some changes to liven it up a bit. It sets up a sequel, however, which obviously never happened and in a way that's far less subtle than how the book sets up a potential continuation. I'm surprised Barker never wrote a second one.

There were comic books instead. They're pretty awful, at least the two I read in middle school.

"It is deeply stupid, but the _______ idea is appealing."

Every Clive Barker book and project.

Clive Barker and Dean Koontz often occupy that "had a good core idea for a story but spoiled it by trying to write it" space in my head.

I've never read a Barker story that ever had a tightly-constructed suspenseful or scary plot. They seem to get bogged down in a kind of mushy attempt to describe everyone's feelings or something. It's like he paints every scene with the same brush, highlighting nothing yet giving detail to the unimportant. Or he just gets far too weird (he had a short story about UK villages that would fight each other every year by strapping themselves into giant Wicker Man-style giants, which then animated and started punching each other... but the protagonists' relationship to each other got in the way, rather than being a tool for tension).

With Koontz, it's more because he puts fucking golden retrievers in everything and has everyone launch into tirades about how libertarians are the chosen gods among men and everyone else is a sniveling evil perv.

Barker's early works are pretty grand and were definitely a breath of fresh after the, what felt like decades, of nothing coming out horror literature except Stephen King, Anne Rice, and Dean Koontz. I was a rabid fan of his when he first hit the scene and those years after Hellraiser was a massive hit. He was a great writer, I think, but then he bogged down in this weird thing of making everything into a complex fantasy world and introducing way too many characters and just making everything far more literary and complex than it needed to be, in my opinion. Maybe he just wanted to be taken more seriously or something, but I think everything pre-Imajica (or maybe pre-Weaveworld) is pretty good reading. I can honestly say Cabal (on which, Nightbreed is based) is probably one of the more rewarding and entertaining books I've ever read.