McCain picking Hillary all but guarantees Obama's victory in November. It'd also guarantee his expulsion from the party. Whoever your lunch guest was, he's an idiot.
Obama will have a hard time continuing the change mantra with the Clinton machine humming away on the other side of the ticket. It's a wrong move that Clinton might give him no choice but to make.
Hillary should take her newfound freedom from Bill's legacy back to the senate, where she can truly wield her power. I've no idea why she'd want to be veep...
Her ultimate goal is still POTUS. I don't see how a VP run really helps. I agree, focusing on the Senate and concentrating on legislation that is in the areas most likely to drive the 2012 elections seems the most direct route.
My guess is she would take the VP position if offered. Say Obama wins, some drunk, racist idiot's gonna shoot the guy simply because he's non-white. Hillary is POTUS. Of course, then some other dude is gonna shoot Hillary...