The report, quoted above, indicates:

But no matter how heinous the conduct of Blagojevich and Harris, none of it amounts to a federal crime without the use of interstate commerce--the mail or telephone lines--to further the scheme.

Well, the reporter appears to have overlooked a few of the allegations.  Paragraph 34:

34. According to Levine, in approximately late October 2003, after Levine was reappointed to the Planning Board, he shared a private plane ride from New York to Chicago with ROD BLAGOJEVICH and Kelly. Levine, ROD BLAGOJEVICH, and Kelly were the only passengers on the flight. According to Levine, at the beginning of the flight, Levine thanked ROD BLAGOJEVICH for reappointing him to the Planning Board. ROD BLAGOJEVICH responded that Levine should only talk with "Tony" [Rezko] or [Kelly] about the Planning Board, "but you stick with us and you will do very well for yourself." ROD BLAGOJEVICH said this in front of Kelly. According to Levine, Levine understood from ROD BLAGOJEVICH's manner of speaking and words that ROD BLAGOJEVICH did not want Levine to talk to ROD BLAGOJEVICH directly about anything to do with the boards, but that Levine should talk to Rezko or Kelly. Levine also understood that ROD BLAGOJEVICH meant that Levine could make a lot of money working with ROD BLAGOJEVICH's administration. According to Levine, ROD BLAGOJEVICH did not seem to expect a response from Levine, and Kelly then shifted the conversation to something else.

Last I checked, New York and Chicago were in different states.

The two-hour telephone conference.  Paragraph 101:

101. On November 10, 2008, ROD BLAGOJEVICH, his wife, JOHN HARRIS, Governor General Counsel, and various Washington-D.C. based advisors, including Advisor B, discussed the open Senate seat during a conference call. (The Washington D.C.-based advisors to ROD BLAGOJEVICH are believed to have participated on this call from Washington D.C.). Various individuals participated at different times during the call. The call lasted for approximately two hours, and what follows are simply summaries of various portions of the two-hour call.
a. ROD BLAGOJEVICH expressed his interest in figuring out a way to make money and build some financial security, while at the same time potentially participating in the political arena again. ROD BLAGOJEVICH mentioned the Senate seat, the dynamics of a new Presidential administration with the strong contacts that ROD BLAGOJEVICH has in it, and asked what if anything he can do to make that work for him and his wife and his responsibilities as  Governor of Illinois. ROD BLAGOJEVICH, suggested during the call that he could name himself to the open Senate seat to avoid impeachment by the State of Illinois legislature. ROD BLAGOJEVICH agreed it was unlikely that the President-elect would name him Secretary of Health and Human Services or give him an ambassadorship because of all of the negative publicity surrounding ROD BLAGOJEVICH.

Picking up a phone is "using interstate wire communications".  Period.

If I'd wanted to spend more than 5 minutes, I could have found more.

That said, I still think that Martin makes some basic errors in her analysis of the federal charges in the complaint.  The first count doesn't charge that Blog and Harris "schemed to defraud." It charges that they conspired to devise a scheme to defraud the people of Illinois of the governor's honest services by use of the mail (or interstate commercial carriers such as FedEx) and by use of interstate wires (phone, e-mail and fax all count).  I cannot see any obvious problem with this theory under the cited law (18 USC 1349, which was new in 2002).  "Honest services" has been narrowed by the courts basically to cover failure to make required disclosures of conflicts of interest, and bribery/payoffs.  Demanding a political tradeoff is not a deprivation of honest services, but a financial reward to the public official or his spouse would be.  The second count of the complaint is laid under 18 USC 666, which is federal program bribery -- seeking or making a corrupt payment of a value of at least $5000 by an official of a state agency that receives more than $10,000/year in federal benefits.  

One is why did not the investigation continue.  If Fitzerald was taping the conversation there had to be someone also discussing quid pro quo.  It takes two to tango.    I do not think that Fitzerald went up to several people and told them to offer the Ill governor money just to see what he would say.  I feel Fitzerald saw where this was going and ended his investigation so as no to many people would be exposed.  

Also does not Fitzerald have a motive to protect Obama for fear of his job during the next administration?

I think the gov is not going to go away without a fight.  He probably has been told to fight this since the case seems shaky against him.   I think he has evidence that will be hurtful to Obama and others and is holding it back if he is brought to trial.  Its his ace in the hold for protection. However, if he sees he is going down then he will talk and bring down as many as he can with him.  Maybe out of spite this guy will appoint a republican before he is forced to leave.  I see no law or current ruling that is taking his power to appoint whoever he wishes to fill the Obama vacancy.

Is favorable publicity "anything of value" to Blagojevich, or must the "value" be monetary? The courts haven't answered this question yet, and it could go either way.

the courts have answered this question, within the context of contract law, hundreds, if not 1,000's of times. it's a no brainer.

I also have to say that Maureen Martin's histrionic posturing is the sort of thing that gives the entire civil rights community a bad name.  As someone who appears to be a federal criminal defense lawyer, she must know that the elements of the various federal crimes, which might apply here, have been given very broad and generous interpretations in the public corruption context. This is especially true of the "thing of value" element and it is clearly a general principle that the people are entitled to honest representation by federal office holders or in transactions involving appointments to federal offices.  If Martin's getting paid to write this as part of Blago's defense that's one thing--good for her---being a defense lawyer can be dirty work but it pays the bills.  But it's hard to see any sort of lofty principles at stake here.  I suspect that Martin doesn't really either.  I think she's reaching.  Let's wait and see what the evidence is and how the case is charged before getting all worked up.

I do, however, agree that the case as it now stands is much weaker than if the Feds had simply allowed the corrupt transaction to play itself out and be captured on tape.  There might even have been the opportunity to tickle the wire to generate additional, even more incriminating conversations by surfacing word of the investigation while maintaining the taps and bugs.  Clearly, Fitzgerald was worried about allowing a "tainted" US Senator to be appointed and indicted shortly thereafter.  In that context, however, Blagojevich is less the victim of prosecutorial overreaching than he is the ironic beneficiary of Fitzgerald's desire to protect the senate from a senator who gained his appointment corruptly.