I'd guess the primary way to "cure" type 2 diabetes is to achieve a healthy weight. Low carb diets do work to help people lose weight (usually only temporarily), but are otherwise quite harmful. The McDougall approach helps people lose weight and be healthy, so it seems like the obvious choice. But I suppose a low-carb diet could help diabetes, as long as one was willing to risk increased risks of heart disease, cancer, kidney stones, osteoporosis, etc.
If you want a true, documented, peer-reviewed scientific study on curing diabetes, check out Dr. Neal Barnard's low-fat vegan diet study:
http://www.vegsource.com/articles2/Diab ... DF2006.pdf