Didn't Judge Walker Already Rule That The Prop 8 Supporters Have Standing?
No. Judge Walker decided that the Prop 8 Backers could intervene, not that they have Article III standing. To intervene in a case, a party does not need to show that they have standing. That's because a "case or controversy" already exists. (The Plaintiffs had standing to bring the case because they were being denied their constitutional right to get married.) Since both the Plaintiffs and the Defendants already had standing, the Court had jurisdication over the "case." From there, deciding that the Prop 8 supporters could intervene in the case was an easy call. The law of the Ninth Circuit holds that a "public interest group may have a protectable interest in defending the legality of a measure it had supported."
But this does not mean that it has standing. To the contrary, on several occasions the Supreme Court has recognized that a party who was allowed to intervene in litigation does not necessarily have standing. For example, the Supreme Court said:
[I]f the original party on whose side a party intervened drops out of the litigation, the intervenor will then have to establish its own standing to continue pursuing litigation. (Diamond v. Charles, 476 U.S. 54, 64, (1986))
Could This End Here And Now?
Maybe at the Ninth Circuit. While the popular spin is that this case "is certain to be resolved at the Supreme Court," that's not entirely clear. If Judge Walker rules that the Prop 8 supporters do not have standing, that does not necessarily mean they can't appeal. The Ninth Circuit will independently decide the issue of standing. But if the Ninth Circuit decides that the supporters of Prop 8 do not have standing, it will reach only the issue of standing, not the much harder question of deciding whether Prop 8 is constitutional.
If A Stay Is Granted, Can The State Still Issue Marriage Licenses?
Yes. All a stay does is prevent the Court Clerk from entering judgment. It does not erase Judge Walker's decision, and it does not prohibit the defendant (the State) from voluntarily complying with the decision by issuing marriage licenses to all couples, regardless of gender. A Federal District Judge has declared that Prop 8 is unconstitutional. Even if judgment in the case is stayed pending appeal, it would be perfectly reasonable for the State to decide that it will stop enforcing Prop 8 until and unless Judge Walker's decision is reversed by another Court.
If the State began enforcing Judge Walker's opinion on its own, I would expect the Prop 8 supporters to file a new lawsuit (in State Court) seeking an injunction requiring the State to enforce Prop 8. This might bring back memories of 2004 when the Supreme Court held that the City and County of San Francisco did not have the authority to issue marriage licenses to same-sex couples. However, that case (Lockyer v. City and County of San Francisco) was based on California Constitution Article III, section 3.5 which prohibits administrative agencies from deciding on their own to not enforce laws based on their belief that the law is unconstitutional. However, if the Governor or the Attorney General made that decision, section 3.5 does not apply. I haven't researched it, but I don't know that anything would prohibit the Governor or the Attorney General from deciding to enforce a District Court's order declaring Prop 8 invalid, even if that judgment were stayed pending appeal.
So with that, we now wait for Judge Walker order on the Motion to Stay. . . Stay tuned . . .