Obama is a Liberal Democrat with no Foreign Policy experience. He has little to no chance drawing moderate Republican votes. McCain has plenty of Foreign Policy experience to go along with his war hero status and will attract more conservative Democrat votes.

Kukri, can you even name a third party presidential candidate? Neither can I.
How about Pat Paulson?

The Dems might be better off nominating Wesley Clark to take on McCain.
However, the problem with party politics is that there's too much concern for the party's perceived needs than for the electorate, and the best candidate for the people sometimes doesn't get the nomination.