She's being represented by a religious right, extremely socially conservative public interest legal foundation. Far more ideological than, say, Klayman. And you know that there are thousands of feminist law communes that would love to be handling this case.
A big part of her case is that the regulation is a violation of religious freedom. Many on the Left are worried about that, because it would strengthen the "free exercise" clause and provide precedents for religious groups that don't want to be forced to hire gay staff under equal employment laws, etc.
Immediately after she filed suit, five Republican Senators including Jesse Helms petitioned the DOD to drop the regulation.
I'm not entirely convinced that her employer is too upset with this lawsuit.
Her primary mission is her military responsibilities. This other stuff is a distraction from that mission. And contrary to some, I am questioning if she followed her Chain of Command on this all the way. Some folks believe she did not and I remember seeing that posted someplace on FR...
I believe her military career is smoked at this point. Maybe not, but that is a hunch...