Tancredo may not be that bad of a candidate.
Illegal immigration won't hurt him as much in Colorado as say California or New Mexico.
He has won in a leaning-Republian suburban Denver district with his conservative record. If he could carry his district by a healthy margin, he could win against Udall.
To be fair, Tancredo's district is more than "leaning Republican", after the last redistricting it became the most GOP district in the state (and it has always been a represented by the GOP since it was established in 1982).