I'm with Dana on being pretty concerned about the role immigration will play in the coming election. Not only is it an increasingly acute -- and motivating -- concern for voters, but it's quite literally the last issue area in which polls show Republicans with the lead. They've lost it on terrorism, taxes, Iraq...but they've got it on immigration.
That's why the hubbub over Hillary Clinton's driver's license" answer worried me. The sentence summary that came out of that debate -- "Hillary Clinton was evasive and muddled while trying to obscure her support for granting driver's licenses to illegal immigrants" -- had two parts. Hillary's competitors were trying to say "Hillary Clinton was evasive and muddled while trying to obscure her support for granting driver's licenses to illegal immigrants." What I think people heard was, "Hillary Clinton was evasive and muddled while trying to obscure her support for granting driver's licenses to illegal immigrants." And that's a line that will nail any of the Democrats.
As for Dana's smart suggestions on how to talk about this stuff, I'd add a bit to her argument: You will, I'm convinced, need to win the border security debate before you can get into any of the more humane issues of paths to citizenship and protecting children. And while saying that Bush and the Republicans have failed for eight years may have some impact, we won't be running against Bush, Instead, my hunch is there's room for an argument saying that the modern GOP won't ever get serious about staunching illegal immigration because their main supporters large corporations, like the supply of cheap labor. It would be trivial to pick through the investments and associations of major Republicans to find links to corporations that have been tagged for hiring undocumented immigrants or that rely on such labor, and use those linkages to make an argument for why Republicans are systemically unwilling to actually crack down on the cause of illegal immigration: Employers who want to undercut wage, benefit, and safety regulations.