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1) Hillary Clinton has put Obama into an entirely impossible position: She is holding him hostage by not conceding that she has lost the race; she has, as W. Shapiro says, held out 'her' supporters as a threat or a bribe. She has made it clear through representatives that she wants the Vice-President spot. //Her representative told the Obama camp they 'had BETTER NOT choose another woman for the VP slot'.
2) Hillary Clinton has 'torn the face off' Obama, as Gwen Ifill so aptly and graphically put it weeks ago, over and over again. She has not shown him respect, indeed has disrespected him over and over again (we all the know the list of ways).
3) How can she expect to be asked to be Vice-President and to work with someone she has treated in such shoddy ways, including alluding to his death as a road to the White House for herself?
-- How can anybody not think, if she becomes Vice-President, she would not be wishing and hoping for her president's death? -- Anybody who would go as far as she has, I think, could do anything.
-- How can we imagine (I can't) her working WITH him, rather than against him? Surely she would be making sure at all times that he would fail and that people wish they had put her in in his place; that seems to be the kind of person she is.
-- In short, if she were in the White House wouldn't she be continually sabotaging 'White House' goals? -- Or, at the very least, making sure, if he had a failure (as everyone has along the way) that people know about it?
4) And if he gave her another 'high-profile' job it couldn't be either Secretary of State or Secretary of Defense -- we couldn't trust her in either of those positions; not State because you have to have a leader there whom other countries can trust; not Defense because she has already made it clear she is all too happy to go to war (and thank you to Walter Shapiro for conceding that her vote for war was 'impossible-to-explain') -- easily and readily, without talking to the people who may currently not like the U.S. This would not work.
She might be Secretary of -- I can't think of anything she would not screw up. If it were Health and Welfare (or whatever they are calling it nowadays) she has already screwed up that before.
-- Maybe it could be 'Homeland Security'. That would be the only position one could imagine she could not harm (if only because it has nowhere else to go but up) and might even have some good ideas about how to organize and manage it (get FEMA out of it, for instance).
Not Environment; she has come out recently in favor of ethanol and that has created havoc with the world's food supply. Her judgement is bad, globally. SHE DOESN'T GET LARGE-SYSTEMS THINKING; she only sees her own interests and what is in front of her at the moment. (Similarly to how she is unable to get what she is doing to her party.)
Would he make her head of Justice? Yes, he would. I would think that would be the only job she might be able to do well and be kept out of the way in terms of policy in the administration. (But, on second thought, I can think of some ways she could get in the way there and I also don't know enought about WH policy in connection with the AG's office; legal, I mean.) As well, Bill Clinton would not have to come along -- would he? (I doubt he would be around much anyway, frankly.)