Prolly moving back to Massachusetts, Teddy needs to retire and Deval Patrick got some promises. *spit*
Tinfoil hat alert: I wouldn't be surprised if Teddy took a health dive yesterday knowing Caroline was not getting the appointment (or they figured MA would be a better fit). So Caroline was given the perfect out and rationale for moving to MA to help take care of Kennedy, establish her residency, and then Teddy will retire and she will get appointed.
As to whether she was actually going to be turned down and got a heads up to save face seems pretty clear. Maybe the fact that media reports stated that Patterson would give Caroline the appointment in exchange for the Kennedy machine supporting Patterson in his 2010 run for Governor may have played a role because it sounded like a quid pro quo, probably legal, but still looking like impropriety on its face.