Ehh, I don't really see it being possible. It's an interesting idea, and I suppose it could be true, but I don't think there's much proof...
1. both places are thriving cities. it makes sense that if your city dosn't sink in a deluge, people will stay put.
True, but consider that while Kakariko and Castle Town are generally the only towns to appear in Zelda games, there's no way they're the only towns or even cities in Hyrule. There has to be loads of other ones.
Also, if the village itself was left unharmed (or mostly so) why would the name change? Wouldn't it be Kakariko Island or something?
2. kakariko is at a rather high altitude, so could survive the flood.
Kakariko isn't at a high altitude. It's always been placed at the base of Death Mountain. It's at the bottom, so it's at a low altitude. It's true that it could still be in highlands or raised ground, but it's clear that at least in most of the games, it's not, it's pretty much at the same level as the rest of the terrain.
3. both are near volcanos (death mountain and dragon roost island) that are speculated to be one and the same.
Good point... but isn't Windfall a little far from Dragon Roost for them to be both Kakariko and Death Mountain? Even if Dragon Roost Island isn't Death Mountain, it still doesn't make sense because Kakariko is at Death Mountain's base; if Windfall is Kakariko then Death Mountain would have to be nearby towering out of the water.
4. both have bomb shops.
True. But then again, most of the games have areas with Bomb Shops, indicating that it's a common thing in the world of Zelda.
Also, the only game that gives Kakariko Bomb Shop specifically, is Twilight Princess, which is on a different timeline from Wind Waker. Not sure if that proves much though... it probably doesn't.
5. kakariko has a graveyard. wind fall has only one grave but it is near a cliff, so the other graves could have fallen into the sea.
Good point. I think most villages in medieval times had their own graveyards, but not necessarily all of them and some might have shared graveyards with nearby villages or churches. Also, doesn't mean it directly translates over to the world of Zelda anyway.
6. they have simular music.
I personally don't agree, but even if I did, it doesn't mean much because Zelda games often recycle music, even in definitely unrelated areas in different kingdoms or even dimensions.