The feds overreached in this case. They had warrants for 10 names, and took 104. Then the names were leaked, with the leaks almost certainly involving one or more federal agents in illegal activity.
Computer searches are an evolving area of 4th Amendment law; it's a new arena, and no one is quite sure how to navigate it. It's taken decades to figure out how to apply the 4th Amendment to automobiles (an area of the law that continues to evolve even now), and I suspect it will take decades to figure out how to apply it to computer searches.
The 9th Circuit, which issued the ruling Obama is challenging, is quite liberal, and is often overruled by the Supreme Court. The challenged decision apparently sets up a complex system of 4th Amendment rules that have "agents, prosecutors, and magistrate judges all scratching their heads trying to figure out what to do," at least according to one commentator (see below). On the other hand, because of the well-publicized leaks, the feds have somewhat "unclean hands" when it comes to this case, which could hurt their efforts on appeal.
Anyhoo, I think the battle has only just begun. I foresee courts wrestling with computer search issues for decades. It's going to take time and experience to strike the right balance.
Commentary from Volokh, a legal blog that tilts slightly to the right of center, here:
http://volokh.com/2009/11/05/ninth-circuit-considers-super-en-banc-for-comprehensive-drug-testing/
And here:
http://volokh.com/2009/11/24/doj-files-brief-supporting-super-en-banc-in-cdt/