Isn't the biggest problem with a Sarah Palin pick that by McCain's own standard, she fails:
John McCain's central and best argument in this campaign is that Barack Obama simply lacks the experience to be President of the United States. And now John McCain, who is a cancer survivor who turns 72 years old today, is picking a vice presidential nominee who has been governor of a small state for less than two years and prior to that was mayor of a town with roughly one-twenty-seventh of the citizens that Barack Obama represented when he was a state senator in Illinois.
Also, if you're making a play for Hillary voters---older, middle-aged white women in rust-belt states--is the way to get it done by bypassing, say, Carly Fiorina and Kay Bailey Hutchison, to pick a former Ms. Alaska who's only been governor for two years? There's a meme about Barack Obama reminding older women of the slick, handsome guy who beat them out for a big promotion, even though they were more qualified. But here's another very likely meme--Sarah Palin as the inexperienced, younger, attractive woman who beats them out for a promotion, even though they were more qualified.
UPDATE: Just want to bang on that last point a little more, as I just got off the phone with Kenyatta. I think there are some weakness to being a party associated with identity politics, and hopefully, the Dems are moving past that. But if you think about it, this is the sort of mistake you make when you have only a vague understanding of sexism and women's issues. I may be very, very, very wrong about this, but let me go out on a limb. I think "Hillary voters" can only resent Barack Obama but so much because he actually won an election. He wasn't appointed--he actually won, and that's a crucial difference.