McCain wasn't willing to forgo the help he was getting from PACs and 527 groups. Obama never said he would accept public money if McCain did. He said he would try to work out an agreement with McCain about the both of them accepting public money. The deal breaker was that McCain wasn't willing to give up the help he was getting from the PACs and the 527 groups.

Obama wasn't willing to be held just to the public money if McCain was going to be getting the outside help, and Obama did not want to be helped by PACs and 527 groups because he feels that they are a big part of the problem with campaign financing. He feels they are a part of what makes our system broken at this time. After he announced that he wouldn't be accepting public money, he instructed his supporters to not give any more money to any PACs of 527.

Obama's stance has been the far more principled one from start to finish on the subject of campaign finance.