snip:
Rove's reluctance to directly admit a relationship with the McCain campaign may be out of concern for staying on the right side of election laws. Aside from all informal advising, he may also be coordinating the efforts of independent political groups and former Bush donors in an attempt to rekindle the type of Swift Boat Veterans for Truth strategy that many analysts believe helped sink John Kerry's campaign in 2004. Rove has one of the most expansive rolodexes in Washington, which he's been putting to use for the 2008 election: According to the National Journal's Peter Stone, Rove has been calling up old friends like Texas oilman T. Boone Pickens and casino mogul Sheldon Adelson, and convincing them to spend millions of dollars on outside right-wing groups, known as 527 and 501(c)(4) entities. An unnamed GOP consultant who "has met with Rove a few times this year" told Stone that "Karl is up to his eyeballs in this." The Washington Post has also reported that Rove is working with outside groups who aim "to influence the outcome in November."
According to Federal Election Commission rules, coordination between a 527 group and a presidential campaign -- such as discussing the content or timing of political ads -- is illegal (if difficult to prove).
snip:
In 2004, it was Republicans who were raising conflict-of-interest complaints. "It seems highly irregular that CNN would tolerate two employees' openly working and advising and appearing on behalf of the John Kerry for President campaign," Steve Schmidt, then a spokesman for President Bush's reelection effort, said of Begala and Carville, according to the New York Times. (At the time, the two CNN commentators were serving as unpaid advisors to John Kerry's campaign.)
Schmidt is now working for McCain's campaign. Not surprisingly, he has not voiced any complaints about Rove's arrangement with Fox News.
Another conservative indignant over Begala and Carville's dual roles in 2004 was Fox's opinion maker Bill O'Reilly. According to MSNBC's Dan Abrams, O'Reilly complained then that their arrangement was the "collapse of CNN's ethical standards." Furthermore, O'Reilly claimed, if he had "signed on with Bush-Cheney 2004," then "the media mob would have stormed the Fox castle."
Since Super Tuesday, Rove has appeared on "The O'Reilly Factor" 13 times. Not once has O'Reilly revealed his guest's relationship to the McCain campaign.
http://www.salon.com/opinion/feature/2008/05/20/rove_fox/index1.html