I've been following their search pretty closely....
and from what I read on TheWolverine.com it sounds like Les Miles was their Plan B and if he had been offered he would have taken the job, even knowing Harbaugh was their clear first choice.
There was also talk of another "big name" as Plan B, but his name was never revealed. It was said this secret Plan B would have made a lot of people happy, but obviously not as ecstatic is the Harbaugh hire.