"Banned for life" was simply MLB's way to force ARod to negotiate a deal rather than extend this into the pennant races/post-season. I don't think anyone believes he can be banned for life. Of course, it sounds like MLB has some form of "obstruction of justice" on ARod so it's more than PED use.
The most likely scenario, IMO, is a suspension for this year and next. After that, the Yanks negotiate a partial settlement of some sort for his final 3 years to send him into the sunset.