They really don't have a Plan B. They don't think that they need one, but they are in denial of the degree to which Hillary Clinton lacks PERSONAL popularity. Yes, they like the feminist idea of Madam President, but I suspect that many of the feminist leftists that are backing Clinton wish that it could be someone else to shatter the glass ceiling.
Hillary Clinton has more personal popularity than anyone else in the entire field, and has had it for a long time. She just doesn't have personal popularity with the right groups. Her personal popularity is with low-income, blue collar groups who don't follow politics very closely. (The reason they don't follow it very closely is because they correctly surmise they don't have very much influence in it.) With people who live out in the boondocks that the Democratic party under Obama has forgotten about, like white working class areas of the Midwest or Upper South. With women, sure. With minorities, sure. With young people, to a greater degree than often imagined.
But not with the right groups of people - the activists on the extreme right and left. Not with those who are motivated enough about politics to go online and comment about it. Not with those who Sarah Palin called, in one of her half-witty, half-braindead aphorisms, the "lamestream media". Not with the latte-drinking, Jacobin-reading Manhattan upper middle class environmental activist who attends Netroots Nation and styles herself a member of the "true left." Not with those people. And it's those people who matter in this country. Those are the people who drive the discourse. And those are the people who will destroy Hillary.
I don't think anyone from the moment he was picked thought Biden would run in 2016, let alone be the frontrunner. The Vice President isn't always the frontrunner after a two term presidency - Dick Cheney was never even seriously talked about. Biden's only one year younger than Sanders, so if you thought Sanders as too old, I don't know why he'd be any better.
Sure, but there have been two Bushes in the White House, and only one Clinton. During Bush Junior's run in 1999-2000 there was no serious anti-dynasty groundswell. Nor was there one during any of the Kennedy brothers' runs or potential runs. In both cases, the men's family names helped them with no serious backlash. And of course, there are political dynasties in all 50 states at lower levels, and no one ever bats an eye. It only seems that when there's an election with Hillary in it, the backlash is huge.