While I'm a little late to the party, the Bush administration was handed a setback today by the 4th Circuit in Al-Marri v. Wright, 06-7247. Effectively assuming disputed questions of fact in favor of the government, a divided panel held that the President can not use the military to indefinitely detain a member of Al-Qaeda apprehended and detained within in the United States. The DOJ has indicated that they intend to seek en banc review.
For more information, I turn it over to the professionals.
Scotusblog
How Appealing
Volokh