Indiana

[struct310]

I used to live in Indiana and one reason might be that the people like things simple in the state.  Liberals make things really complex in their plans (healthcare for one, mainly to hide the real socialist plan behind it).  The people really hate tax raises as well.  

[struct310]

If we break Indiana into rough geo-political regions:

Gary-Hammond

A blue collar (more steel is made in Lake County than any other part of the U.S), heavily unionised area and by far the most Democratic part of Indiana

South Bend-Elkhart

The South Bend area is very "ethnic" (the largest Hungarian Community in the U.S is in the area) and fairly Blue Collar, while Elkhart is solidly Republican. Overall the region swings about *a lot*

Fort Wayne

With the exception of a few blue collar districts in Fort Wayne itself, Fort Wayne (along with it's suburbs) is a GOP stronghold (and has been since the Civil War)

The Corn Belt

Sterotypical Indiana: lots of farms and small towns, "rednecks", religious zealots... The Cornbelt covers most of the state and is the backbone of the Indiana GOP (and has been Republican since the Civil War).

Indianapolis and Suburbs

While Indianapolis itself leans Democrat, the wealthy suburbs of Indianapolis are the most Republican parts of the state with several counties voting for Bush with over 70% of the vote.

Muncie

The "Middletown" area is fairly centrist and tends to swing around a bit... (Clinton in '96, Bush in '00) it also has a quirky independent streak (Perot did well in the Muncie area in '92)

Indiana Coalfield

Basically an extension of the Southern Illinois Coalfield, the area includes Vermillion County (after Lake, the most reliably Democratic county in Indiana) and overall leans Democrat. The largest City (Terre Haute) is a traditional hotbed of Populism.

Ohio Valley

A traditional swing area, the Ohio Valley tends to be socially conservative and economically leftist and has a habit of producing large swings without little warning.
Democrats often do well in the (very) blue collar counties in the Southeast of the area.

Gary-Hammond is more democratic not because of unions, but because of the high volume of African Americans living there.  
Indianapolis the city is lean democrat like you said, but in a comfortable margin say 4-5pts, Bush could sweep the downtown area and democrat Julia Carsons district.  As in Gary, Indianapolis city has a large African American population.  Southward in Bloomington, the college town, is where you'll find the most progressive part of Indiana.  The city claimed itself "gay friendly" and started promoting "gay tourism" to the area.

[struct310]

A lot of people say that Indiana is conservative/Republican because of its rural-ness, but actually many states are more rural and less Republican than Indiana (including Midwestern states such as Minn., Iowa, and Wisc.)

Perhaps Indiana is Republican because it has relatively few ethnic whites, Hispanics, or Asians.

Actually there are a ton of Hispanics in Indianapolis and the city is becoming Little Mexico.  A street I frequented as a kid turned from vintage 50s style to the ugly and beaten down Hispanic shops like we have here in Arizona in the ghetto parts of town.  And I wouldnt assume Asians are very democratic, it depends on where they are at.  The vote swings either way with Asians.  You are right about ethnic whites, unless you count the Amish, who vote republican.