Hi Fly Guy,
Very sorry to hear about your wife's condition, hope all the treatments go well. I think if you cancel now, since its a little less than the 60 days before the cruise, you can still cancel, but it will cost a penalty, which would still be better than loosing the whole amount. Did you purchase any travel insurance, if so, that should cover it?? I know with the penalty, the closer it is to the cruise the amount you loose does go up, so you need to decide what to do ASAP.
Too bad RCCL will not just transfer the booking to a later date, may-be your travel agent can try talking to them again??