I agree that it's over for her as a nationally elected politician. With one caveat - If Biden somehow finds himself off the ticket in 2012, I'll give you one guess who his replacement will be.
Hilary's no spring chicken. Thatcher was 53 or 54 when she assumed the role of Prime Minister. Clinton would be 69 for the 2016 election. It may sound sexist, but America is not going to elect a 70 year-old woman when they already passed on a 70 year-old war hero.
I have a feeling that Obama will force Biden into retirement in 2012, and replace him either Mark Warner or Colin Powell.