I really do not think survival is possible (due to the speed, and also the altitude) unless an actual miracle was to occur.
Personally i think probably the ceramic tiles which help the shuttle not heat up during re-entry probably started to come off and consequently the shuttle could not handle the high temperatures.
Very sad.
I just hope it is not terrorism, athough if it were that would be extremely hard to do (the only 2 nations that could hit a target that high up are the Russians and the US .....and even that would necessitate quite advanced means and may not even work because the shuttle was extremely high and moving at 7 times the speed of a bullet fired from a rifle. Hence the shuttle being shot down is not probable. Sabotage before take off is possible, but even that is improbable because there are people who check for problems. Hence it is most probably an accident).
Just pray for the families. Most were watching to see their loved ones return, and i dare not imagine what they are going through.