I think Obama ought to keep Gates around for a little while at SecDef. He seems qualified and competent, but this might just be my reaction after having Rummy in the spot...

Hillary for State would be a disaster. She and Bill would try to steal the spotlight whenever possible. Pros would include more situations of "sniper dodging" though.

For this libertarian/conservative, Attorney General is the position I'm looking at closely. Justice is in serious need of an overhaul, and OLC need to be both completely exposed and disbanded. Hopefully he picks somebody with at least a vague working knowledge of the Constitution.