Hard to comprehend now, but Murko and McCain are from different wings of the 2000s GOP.
McCain was from the reformer/anti-pork wing.
Murkowski was in the big energy/pro-pork wing.
The reason why Palin was chosen, was precisely because she had defeated Frank Murkowski and had then gone after the oil companies on some state level issues. McCain, who favored campaign finance reform and opposed many special interests thus saw her as a kindred spirt on some of the matters he most cared about and also as a new and exciting face that could energize his flailing campaign.
Murkowski is also pro-choice. McCain picking her would have led to a rebellion by both fiscal conservatives and the evangelicals thus.
This matchup sounds like the quickest way to crash and burn the GOP for half a decade. McCain/Murkowski don't seem to work particularly well as a ticket and something like this would weaken the party enough for it to lose yet another election.