The issue now, is --can replacing Lott be engineered in a way to do as little damage as possible? No doubt the Dems will crow. They will say Lott's stepping down PROVES R's are racsists. I think the R's should stage a big press conference where Lott announces he will not run for the leadership position because of the hub-bub over his poor choice of words. The R's should point out the partisan double standards that are routinely applied. They should point out that ex-KKK Byrd is never criticized by the Left, give some other such examples, and forcefully require some Dems to defend against charges of racism.
Even though I think Lott has to give up the position of Majority Leader, I also think the R's should go on the offensive about the character asassination aspect of this.
I think he has to go too, just not right now. The scenario you put forth would work excellently in absolving the party and Lott. But if it were done right now, the gains from 'victim' status would be offset by the appearance of weakness. The whole party would be perceived by many voters as caving in even though we knew we were right. There was some truth in part of what Clinton said: "When people feel uncertain, they'd rather have somebody who's strong and wrong than somebody who's weak and right." Sad, but true. Unfortunately, we've already selected Lott as leader. We need to fight this now, and have Lott quietly step aside later, apparently for other reasons that are non-threatening. I want him gone, too. The first break in the next congress would be perfect.