I'm really chuffed about McCain. But his squeaker in South Carolina makes it both more likely that he will be the nominee and less likely that he will unite the GOP enthusiastically behind him. He may have to put Huckabee on the ticket at this rate, which will make him uncomfortable and the economic right apoplectic. A very narrow and divisive McCain victory wouldn't be as bad for the GOP as a narrow and divisive Romney victory, but it's not great news either.
Similarly, the longer the Democratic race goes on, the likelier it appears that Clinton could well win the nomination in a way almost designed to maximally divide and demoralize her own party - and raise her own national negatives to stratospheric levels. It would mean a Clinton candidacy in the fall that had actively alienated independents and repelled Republicans, while undermining a key source of Democratic support - African-Americans.
If both parties commit slow suicide, does either win in the end?
Umm, yes. In a two party system, someone wins in the end.
Actually, I think the primary race will be worse for the Democrats, although it may not be bad enough to overcome the Republicans' natural disadvantages of being identified with an unpopular war and incumbency in an economic downturn. McCain is disliked for not being tribal enough -- he has shown himself quite willing to make his party look bad to make himself look good. But he's basically sound on the issues from a Republican point-of-veiw, and hard-core partisans are bound to come back to him.
On the other hand, if Ms. Clinton wins a divisive fight, it can't be good for the Dems. Obama seems to have united the constituencies of Gary Hart and Jesse Jackson against the constituency of Walter Mondale, augmented by the Hispanic demographic boom. I don't think the latter two groups are a sufficient national coalition. And people hate being on the receiving end of the Clintons' political skills. In the last two weeks, she's managed to piss off blacks and Reagan Democrats.