I'm the only one who has to say this, but even if you have someone with a beautiful voice who does it wonderfully, I don't think the song needs to be a duet by any stretch. It really seems to be a purely Ernie song, and it speaks to his wacky imaginative side in a soft, quiet, reflective sort of way. I really think this song is better suited to be Ernie's signature character song than Rubber Duckie.
I think duets take away from that, even the good Shawn Colvin version. It seems to say that he would love to be something else, but he's happy to be himself, and where he is. Sort of like "Imagine That" but, again, more reflective.