I'm not a lawyer but my hunch is that the main problem (in the eyes of leftists) is the punishment aspect.I think the left would (rightly) claim victory if the final ruling is that AZ can *question* but cannot *punish*...which,it would appear,is what some folks (who presumably know the law and the courts) are saying will happen.
(Yes,I understand that leftist bias could mean that these "folks" are wrong)
You said detain or punish and i can see where the length of detention could be construed as a punishment. If the state had to hold onto an illegal for two weeks waiting for the feds to pick them up for deportation then that two weeks could be seen as a sentence by some.
I think a victory for Obama of the sort you describe would be Pyrrhic at best. It stands a real chance of causing a break between the states and the feds when it comes to cooperation. Its a serious issue.
if the final ruling is that AZ can *question* but cannot *punish*