First, let's go over what Rove does that's so successful. Instead of attacking the enemy's weakness, he attacks their strength--generally with lies. When up against Gore in 2000, he turned Gore's championing of the internet around and made it look like Gore was exaggerating about it, painting a picture of him as a big exaggerator (this didn't stop Gore from winning the election (which a total recount of all votes in Florida showed), but then they just stole it anyway). When up against Kerry in 2004, he attacked Kerry's reputation as a war hero by manufacturing the Swift Boat scandal, which was composed of people who weren't in Kerry's boat but had connections to the Bush administration claiming that the people who were in Kerry's boat, the official record, and even the Vietnamese who hated Kerry were lying about what transpired.
So, onto what Democrats should do this time:
When Rove attacks your strong points, fight back.
If the Republicans try to bring up the Iraq war and characterize you as cut-and-runners, accept the subject but reject their analysis of it. Go into detail about all the screw-ups the Republicans have made over there, and if they try to challenge you about what you'd do to change things, don't go into detail. (It's not as intellectually honest as I'd prefer, but this is politics, not science.) Characterize them as the ones who created and are perpetuating a problem, and say that if people want to actually fix the problem, they should vote democratically.
Of course, don't entirely evade the question of what you'd do in Iraq, but also be sure to challenge them on what they're going to do. If they give the old "Stay the course" line, respond that "This course has lead the country into ruin. Do you want to go further in that direction?" As for what you'd do, give general platitudes as Nixon did in relation to pulling out of Vietnam. Say general political crap like "Reach out to Sunnis," "Train Iraqi soldiers to take care of their own country," and "Slowly reduce American presence." The public doesn't want to hear about the details and probably won't understand them anyway.
Attack the Republicans' strong points.
The Republicans have three major appeals these days: to the wealthy, religious, and pseudo-patriotic. The wealthy aren't a good target here as they're few in number, and their major contribution (money) has already been given by the campaigning stage. Rather, attack their religious and patriotic appeal. But importantly, this shouldn't be done with lies, but with inconvenient truths.
First, for the religious appeal. They do a good job (way too good) of voting with the religious right on many issues, so that's not a good aspect to attack. Instead, depict the candidates acting in blatantly non-Christian manners. Bring up scandal stories of them doing drugs as kids (easy to show with Bush himself), political corruption (ditto), and lying (ditto again), all very un-Christian actions. And of course, don't do any of that yourselves.
Secondly, their pseudo-patriotic appeal. I use the "pseudo" prefix as a lot of what they do is faking it. They simply say that following them is patriotic rather than prove it. Point this out. Also harp on how this is a democracy, government by the people. It's patriotic to do our job in watching the politicians. Use a tagline like "Patriotism is obedience in a dictatorship. In a democracy, it's vigilance." You might even want to point out how the whole Plame Affair constitutes treason, and there's good reason to believe some top officials were behind it.
Attack the Republicans' weak points.
This one is pretty obvious, and the Dems have already been doing a lot of it. Keep up with old talking points like how no net jobs have been created since Bush took office (meaning we have just as many, if not fewer, jobs today as we did back then, despite increasing population). Their disregard for the environment is another big one (use some of the publicity created by Gore's recent movie for this). Last but not least, their attempt to subvert science is really bad. It shows that these guys aren't invested in finding the truth and doing the best thing with it; they're invested in advancing their political agenda.