This entire debate about whether or not "conservatism" has advanced or declined under big-spenders like George W. Bush and Tom DeLay seems muddled to me. Here's another possible way of looking at it, which may or may not be right. Bush-style "conservatism" over the past decade, I think, has basically taken up the same aims as DLC-style "liberalism" (or even, in a sense, Lyndon Johnson-style liberalism): you have technocratic elites commandeering the resources of the administrative state to enact their preferred social policies and to steer taxpayer money towards their favored constituents. Obviously, the two sides have somewhat different constituents: Bush favors the capitalist class, the DLC favors the educated professional class. Or whatever. But there you go.
So yes, we'll get Bush-style conservatism vs. DLC liberalism for eons to come, thanks to the sort of state Bush and DeLay have helped reify—though they hardly created it. Over the long haul, neither side will gain an absolute edge: the Republicans have a rural-state advantage in the Senate, while the Democrats have popular opinion on cultural and many policy issues on their side. Nevertheless, we're looking forward to two patronage parties, frozen in power until the next major economic crisis hits and knocks over the whole damn chessboard. Obviously I wouldn't equate the two sides: the Republicans are doing real damage and need to be kicked out as soon as possible, and the Democrats can still do a great deal of good, but I'm afraid "conservatism" isn't in any more of a crisis, fundamentally, than "liberalism." Limited government (along with a return to 1950s social conservatism) on the right and social democracy on the left have both been throttled. Whether that's okay with people or not is another question.
Basically the Left and the Right are stuck in their current awkward positions. But it's always fun to choose sides in the Battle between rich well connected Democrats and rich well connected Republicans.