Since I don't really care for the Summer Olympics, I wouldn't be terribly broken up if we decided to boycott. Moreover, since China's purpose in pursuing the Games has always been avowedly political (this is the PRC's coming out party) there's nothing wrong with making a political statement on what amounts to a political statement. Nevertheless, there seems to be a fair amount of silliness associated with the pro-boycott arguments. Seriously, we should boycott because of China's support of the Burmese junta? India conducts more trade with Burma than China does, and I don't recall hearing anyone suggest that we ought to challenge India on this point. Rather, the Burma issue provided a convenient club for people who wanted to bash China anyway.
The key issue is whether the threat of some sort of boycott would actually alter Chinese behavior in a meaningful fashion, or whether it would amount to political theater. Since the Chinese regard the Games as very politically important, it's not implausible to suggest that there just might be an almost unique opportunity for pushing them in one direction or another. I wonder, however, how anyone can ensure that the Chinese will comply with whatever steps they agree to take under the force of such a threat. And while political theater is fine and good (this is what the Opening Ceremony amounts to, anyway) I have to wonder who, precisely, we're trying to fool; China is a critical participant in the modern world capitalist economy, and one of the reasons that people are thinking about a boycott is that no one wants to take any real measure to hurt the Chinese.
In 1980 we were in a genuine Cold War with Russia, but today even the most enthusiastic of China Hawks don't have much stomach for anything more than pretending we're in a Cold War with China, while at the same time maintaining a robust and expanding trade relationship. As such, this would seem to be political theater to little point; a move to pacify a variety of anti-China constituencies, without taking any real steps to make particular Chinese behaviors costly.
Also see Drezner, Charli Carpenter, Farrell, and Clemons
--Robert Farley