This is great news for Obama.  And if Clinton is not careful, how she responds to this may end her campaign.

It's not her decision to make whether Michigan chooses to hold a caucus and whether the DNC chooses to seat the delegates selected by the caucus.  The only decision she has to make is whether she will place her name on the ballot.  If she doesn't, she doesn't get any delegates.  

This basically is a PR nightmare for her because she will not do well in a caucus, but if she refuses to participate, she looks arrogant, elitist, and unwilling to accept a negotiated compromise.