I agree with your points, but to play devil's advocate for a moment, the Yankees need to do the following, and they have had a difficult time doing them:
Slow up Ortiz. The man makes a hugh living on NY pitching. Yanks need to keep his damage to a minimum, especially in clutch situations.
Since Schilling probably goes 3 starts in the 7 games, he most likely wins 2. Yanks therefore need to beat up on Wakefield and Arroyo.
Yankees can not count on Boston shooting themselves in the foot with shoddy defensive play, except at 1B with Millar. If Manch.... is at 1B, then Yanks gain by the Sox having a weaker bat in the lineup.