If a federal lawsuit results in a settlement, is that case still a matter of case law?

No. If a case is settled out of court and a ruling was never made by a judge or jury, than it is not a caselaw. A case would set a precedent if an En Banc decision was made. En Banc decision is when appelate judges in a panel make a final decision after the case was appealed. If a case was never heard, than there is no precedent or case law. That is why it is called a "settlement" En Banc is the 1st level of a case being a "caselaw"