I think it's nothing but an interesting academic exercize. "The system" is content to operate on the word of Justice O'Connor that she will not provoke a Constitutional crisis by holding her seat past the time a replacement is confirmed.
But the scenario SHE chose to set has the potential to result in a butting of heads between the President, Senate and Court. I wonder if US history has any other examples of Justices giving retirement dates that are contingent on confirmation of their replacement.
You're so right. Suppose O'Conner were to say, "Gee, Prez, I really don't like Alito taking MY seat here - You must get a woman here..." What can occur? The Senate impeaching her?