Stan Schroeder over at Mashable (generally on the ball - but not this time!) thinks that AOL is "loser" that won't help Yahoo win the battle.
I happen to strongly disagree.
Yahoo's problem is not their properties. They have a hell of alot of good properties. Their search, Real Media acquisition, IM client, flickr, mybloglog (miniscule in comparison), email, their portals, I don't even know everything they have - and they are all great properties.
The problem is that they have no unique vision - and no leader to motivate the team.
Considering that that is the real issue - not bad crappy products, I think Microsoft has the potential to be a real mess for integration. It will kill morale, scare away most of the talent that is still at Yahoo, and won't assist in integration much. Alot of the value that Yahoo currently has may be lost by the deal. (If I was Google, I'd be rooting for this one, maybe put in the extra couple billion dollars that Yahoo is haggling over!)
On the other hand, AOL is a pretty tight ship from what I see. They obviously lost the search game years ago, and unlike ASK, are not crying over spilled milk. They have a number of different properties, but they've really been working hard on integrating all of the different platforms under one API - without forcing to many of the services into bed together. (http://dev.aol.com/)
The developers in AOL that I've talked to are really happy about where they are, and they love the independence that they get.
Interestingly enough, AOL has been targeting the developers alot - which is a smart play considering that developers are the access key to the crowd. The developer builds a "product" that "interacts with your platform", a whole lot of people like it, you just got yourself free traffic. (Think facebook, or Google for that matter.)
All in all, I think that it's possible that AOL has enough "Vision Manliness" to infuse Yahoo with it as well - and if it works, is a better deal for Yahoo shareholders - and users.