Jeb won't run in '08. I wouldn't be surprised to see him run for U.S. senator in 2006, though.
I honestly don't see anybody in the Bush family running for a legislative seat anymore. It is not in their character. They are the sort who need to run things and be in charge.
And like I said, I think it is perfectly plausible for Jeb to run for the GOP nomination in 2008. After all, who else is there? Sure, folks mention Guliani, but does anybody actually expect him to get any religious conservatives behind him? He'll go in with big fanfare, and come out with very little.