At the very least McCain needs someone who seems capable of walking and chewing gum at the same time.
It was just a bridge too far for him. He could have easily comforted the Talibagelicals by choosing Huckabee, Pence, Thune or another arch social conservative. But Palin met that requirement and had perky tits. That, I suspect McCain's advisors thought, would -- err -- excite -- younger, male voters. I still find it impossible to believe anyone seriously thought pro-choice feminists who supported Clinton would ever find Palin an attractive alternative. Maybe a tiny handful, out of spite. But I emphasize "tiny"....
I really thought Pawlenty was looking good, just because we heard so much build up over the months about how McCain cherishes those who show him loyalty. And like Pawlenty or not, you gotta hand it to the man. He remained loyal to McCain...even when the chips were down.
I doubt that (in bold) had anything to do with it. McCain went with Palin hoping to get a combination of fundie mobilization and to boost his image as a reformer, the other guys wouldn't do the latter. Palin was never about winning over disgruntled Hillary voters for reasons Sam Spade covered long ago and was never about winning over males. He didn't pick Jessica Alba. Romney would've been an attack dog, but McCain didn't think he needed that at the time. Pawlenty would've been the dull, "safe" choice hardly changing the dynamics. But McCain the Gambler can't do that.
Seems you've made a total 180 on Palin's effect though.