In the years that have passed since their first meeting, Cotto has been able to maintain his power, conditioning and grudge better than Margarito has. Cotto wins inside of six rounds.
Cotto is a little less damaged and more versatile than Margarito. He'll move more and target Margarito's suspect eye. The moment that eye bleeds or swells, expect a swift referee stoppage. Cotto TKO8.
Both guys are extraordinarily motivated for the ultimate grudge match, but I think Cotto, with more left in the tank, will score a middle-round TKO when the ref stops the fight due to damage to Margarito's right eye.