From what I can tell from Iraqi blogs, Sadr's Mahdi militia is seen as a bunch of lunatics. Apparently they've blown up cd stores in Baghdad because the lyrics are "offensive." These are poor, frustrated Shiites without options for growth; it's frustrating.
If Sadr IS killed, he'll be a martyr, yes. But none of his lieutenants have any real religious authority, and I doubt they would be able to continue his movement.