Here's an interesting analysis.
With the exception of the annoying choice of "Copper State" instead of "Grand Canyon State" the analysis seems pretty solid. I think Republicans will do better in the Congressional contests than the author does, but the article is interesting nonetheless.
The Copper State has tilted heavily Republican for sixty years. It was the only non-Southern state to support its favorite son Barry Goldwater in 1964. It has tilted back some to the Democrats over the past two decades. In 1996 it voted for Bill Clinton, its only vote for the Democratic nominee in 60 years. A rapidly growing Hispanic population has proved key to Democratic emergence here. Hard-line immigration positions did not help the Republicans at all in 2006, as they lost two House seats. Arizona would probably be prime battleground territory in 2008, except that Republicans have nominated the state’s senior Senator, John McCain, as their Presidential nominee.