No DoT, Nikijih's suggestion is perfect. It's what many havel asked for. We've discussed it previously, and shown that it is a great solution. Nobody wants to get hit by giant numbers, and nobody wants to spend countless minutes doing nothing in order to finally put these numbers out. Adding a DoT is a straight out nerf and only mildly pleases one side.
If Chaos Bolt's damage is nerfed, than Havoc will obviously allow for more than 1 to be cast. It won't nerf cleaving capabilities.
Basically, the damage within a 1 second interval should remain the same, except it would be distributed in a less drastic way. Instead of pumping out 4 chaos bolts in 10 seconds (considering Backdraft), each hitting for 2.5 damage each (just an example); you put out 4 Chaos Bolts for 2 damage each in 7 seconds and 2 incinerates hitting for 1 damage each.
The only disadvantage is that damage spikes become smaller, however they're more often. Other than that it's nothing but a buff in PvE and PvP. And last time I checked, the spec is behind the rest, and the only thing keeping it up is clever use of Shadowburn which is not what the spec is based around (curse you Zumzum!).
---------- Post added 2012-11-03 at 12:20 AM ----------
The only thing I disagree with is Shadowburn. I hate RNG, and it never really had its place in the warlock class. Plus, putting something as deadly as Shadowburn in the domain of RNG is not the most "stable" idea. I think that Burning Embers depending on crit is RNG enough for us.