I think Karl Rove says that Kerry could have won Virginia if he had challenged Virginia, and put resources into the state.
The issue is that Virginia had been Republican for so long that Democrats didn't realize that it had become a Democrat state until after.
Karl Rove, again, points to West Virginia as a comparison. West Virginia was considered a Democrat state for a while; Bill Clinton won it by a good margin. But then the GOP realized that it was a GOP state, they put resources into it, and it's been a GOP stronghold since 2000.
Yes, Rove said exactly that during 2012 Election Night on FoxNews, I rewatched their coverage just around 10 days ago.
Anyway, my opinion is that 2004 was still too early for a Dem presidential win there, particularly after 9/11 in a State with strong bounds to the military...maybe contesting it could have resulted in a milder defeat, maybe a 4-5 points one, but still a defeat...the Kerry strategy was clearly Gore States plus a big one, Florida and/or Ohio, and something smaller like New Hampshire and/or Nevada to compensate a possible similar loss in Gore States( like those he suffered in Iowa and New Mexico).