Do the Democrats really want to win this time round? Think about it. Iraq is a mess and seems likely to get worse and involve more military commitment than is currently deployed, the economy isn't in a good state and the federal budget is screwed. To fix these will take some tough, probably unpopular, decisions for the next President.
If Kerry gets the job, the Republicans will slam him in 2008 and he runs the risk of being a one-term President. On the other hand, if Bush gets stuck with it and makes a predictable hash of the job, the head of steam thus built up would see the election of virtually any candidate the Democrats can come up with plus a solid chance of re-election in 2012 (stand up Hillary).
Furthermore, the growing anger would give the Democrats a chance to recapture one or both of the Congressional chambers, thus gifting the 2008 winner a friendly Congress - while poor old Kerry will still be stuck with a neo-conservative Republican congress opposing him at every turn.
The real problem with this scenario is that it leaves Cheney/Bush at the controls for another four years - without the carrot of re-election to distract them from eroding the constitution, destroying the environment and destabilising regimes across the planet.
What is certain is that the US has never been so politically divided - I don't think that it was even this difficult in the late 60s/early 70s with Vietnam and Nixon.