What we should remember is that if Scotter Libby doesn't want to go to prison for lying.....thing is, why did he lie if nothing happened?
In other words....major stuff could happen if he squeal information to the Prosecutor of his "boss", Vice-President Dick Cheney. That is, if the President doesn't pardon Libby. However, it wouldn't be wise to pardon Libby unless its absolutely necessary, since the possible backlash in the media and public would be....brutal for a President, as low as his polls are.
If anything, the President should ask Cheney to resign, and nominate/approve a new Vice-President.