One of the things the Dems ran on was that Bush didn't know how to handle the Iraq situation, that was one of the reasons the whole advisory council got formed and made their report. Now they're opposing one of the recommendations of the council (the troop surge), but they can't even get their ducks in a row to make their opposition to this official.
And if they go for impeachment that's only going to help the GOP. Impeachment doesn't play well with the middle, they don't like bitter revenge driven politics. The impeachment of Clinton really hurt the GOP in 96, and if the Dems go down that path we can use the exact same campaign in 08 they used in 96, hammer them for distracting the goverment from important thing and wasting time and money on political vengeance.
"We?" You mean the beleagured GOP? I've never seen the GOP use a hammer to do anything but smash their own thumb.