I agree that this looks bad, and it's a no-win for the Presdient. But the major problem here is the fact that the democrats have highjacked this commission and have turned it into a prospecting expedition for election dirt to throw at President Bush.
I'm sure that the commission is allowed access to classified material, which the Rats would fall all over themselves to leak to the public if they thought it would cost Bush support. And if it endangers a few intelligence sources and/or methods, oh well - they want to cut the CIA "down to size" anyway. Hence Bush is forced to do what he can to protect our intelligence assets, which is to testify in private and limit the number of people with access to the direct testimony.
Clinton and Gore, OTOH, would have no legitimate access to classifed information, so these constraints don't apply. The Rats of course are fully aware of this and will shamelessly exploit this by portraying Bush as having something to hide. So Bush has two choices - continue to insist on testifying privately and be painted as covering up facts, or testify in public and really endanger intelligence assets.