In other words, Bush got his cake and ate it. He got thru his recess appointments and his judges. Daschle is the one who caved by letting go of his leverage for a promise that Bush won't do what he wasn't going to do anyways. Daschle saves face, Bush wins.
The Dems set an outrageous precedent with their extra-Constitutional filibuster and know full well it can be used against them. They were hoping the Pubs would do something rash and thus lay the blame for the whole mess on them.
To me, this signals that they are terrified that the Pubs will, with the help of a few moderate Dems (if there are any left) after November, reach the filibuster-proof magic number of 60 and then there will be hell to pay for them.
I've thought for some time that any deal would be made from a position of strength and patience by the WH and Frist. IMHO, the Dems blinked. Betcha part of the deal included some threats of super-campaigning by Bush against certain high-ranking Senate Dems up for re-election.
Also, Bush can always renominate the six "controversial" judges after he wins re-election, which, judging by this deal, is something the Dems are just about conceding.