Mukasey can't say its illegal without hurting the Bushies
Shorter New York Times: Mukasey may think water-boarding is illegal, but he can't say so without putting members of the Bush administration in legal jeopardy ("How can you say what you did was okay if your own Attorney General says it is not?"). Therefore he is punting on the issue in order to avoid embarrassing his benefactors.
In other words, he is putting the well-being of the Bushies ahead of defending the law.
Yeah, he sounds "qualified" under the rules of this administration.