Boxer isn't that popular, and 2010 could be a good year for Republicans.
But the odds are against him at the moment.
Personally, I can't imagine Arnold fitting in very well in the Senate--he'd probably want to keep his current job for life if he could.
Are the California term limits permanent, or is it a 'consecutive terms' limit? If it's the latter (which I'm pretty sure it isn't), he could just come back again in 2014.
There have been alot of rumors though floating around in California coming from close friends of the Governor saying that he is hinting a possible run for Senate in 2010.