...is one of the biggest events of the off-season, and we're barely into February. However, I remain amazed that this did not happen sooner. By their own admissions, both Schottenheimer and Chargers GM A.J. Smith have not had a positive working relationship for years.
Most of the culpability lies with ownership, for the following reasons:

1. Working Relationships
Dean Spanos, by all accounts, tried on several occasions to persuade Schottenheimer and Smith to stop fighting each other, and instead focus on beating external opponents. Clearly, that approach did not succeed, which begs the question of why Spanos did not fire both men. When two senior leaders will not work together in a constructive fashion, the right answer is to fire them both. It takes two to make an argument, and AJ Smith cannot kiss off accountability. I remain suspicious that Smith is accountability-shy, whereas Marty does not seem to deny accountability.

2. Contract extensions
When the decision was made to continue with Schottenheimer in the aftermath of the Chargers' exit from the playoffs, the team offered him a 1-year extension to his contract (which had only 1 year to run) to take him to the end of the 2008 season. Not only was the extension only a 1 year deal, but the team added a $1m buy-out to it. In other words they could still effectively fire Marty after the 2007 season for the cost of the 2008 year plus $1m.
Schottenheimer turned the extension deal down, which apparently displeased AJ Smith and Spanos, but my question is: what did they expect? By only offering a 1 year extension they were effectively giving Schottenheimer a limited vote of confidence as in "we intend to keep your rope short". I would have refused to sign an extension like that also. Either a team wants you or it doesn't. Sort-of-wanting somebody is not good enough.
With only 1 year left on Schottenheimer's contract, and with rumours that Pete Carroll is waiting to assume command of the Chargers, it is obvious why all of the coaching staff would be interested in other jobs. They would not want to work for a "lame duck" coach, only to find themselves being replaced or evaluated by his replacement come January 2008. That would take them out of control of their destiny. Hence the departure of both co-ordinators and several other assistants.

Right now, most of the head-coaching candidates have already found other jobs. However, given the quality of the roster, with many marquee players signed to long contracts, the Chargers will certainly have a queue rapidly forming. Mike Martz, for example, might be salivating right now at offensiver personnel that remind him of "The Greatest Show on Turf" group that he coached with the Rams from 1999-2002.
The big challenge, however, is whether a prospective head coach can co-exist with AJ Smith. Schottenheimer's departure may send a signal that Chargers ownership will expect a new head coach to defer to Smith on personnel matters. (Of course, Marty's insistence on hiring his brother was always going to cause fireworks, which makes me wonder whether he looked at the threadbare coaching staff remnants and then decided to provoke his own departure...)
I fail to see why Pete Carroll would want to assume control of the Chargers. Although he might get full control over personnel, the decision record of the Spanos family does not inspire confidence. By all accounts, this is not the first time that they failed to stop a coach from locking horns with a GM; it previously happened between Bobby Beathard and Bobby Ross.