You are correct. The scumbags knew all along about Armitage but the mystery is how they could have thought that Armitage would not eventually be exposed. For one thing, they knew that Novak knew. That's the part that makes no sense.
Maybe they calculated that by the time Armitage was exposed it would be too late and the damage would already have been done to Bush and Cheney. And, because of the intense political pressures, they were still able to ruin Lewis Libby's career; get the White House spooked; and almost get Karl Rove indicted. So they were able to get a certain amount of vindictive satisfaction out of it.
Kerry's election in '04 was probably supposed to facilitate the burying of the story. After all electing Kerry was also the PURPOSE of the story, so it could have been spiked once that was accomplished.
But then many kept it up after November '04. That is puzzling. Could Hissy Matthews and Liar O'Donnell have been out of the loop, or did they just start believing their own B.S.?
Of course in part it was the insatiable hatred and willful delusions of the left-wing blogosphere (and the desire of mediots to be lauded thereby) that kept things going.