Just to preface, I'm not a resident of Indiana. In fact, I'm from PA and haven't been home in about two years, but I would like to throw out an idea to Hoosier Dems to get a decent senate candidate.
Very simply, call/write/e-mail the Indiana Democratic Party and demand that they hold a caucus to decide the nominee for the fall's general election.
Here are some arguments you can make:
(1) Bayh's retirement has denied Indiana Democrats the right to decide their nominee for the general election. Is that fair? No. Is it small D democratic? Hell no!
(2) By having a caucus you can field test a candidate's ability to create and organize grassroots support. Obama did this in the primary and again in the general in Indiana.
(3) The base can get organized and energized for the fall against weak or very unpopular Republican candidates.
(4) This is just for progressives more but: an active progressive base in a caucus can get a real Democrat instead of another Blue Dog/Corporate type like Bayh.
Feel free to go with any of these ideas and best of luck!