Just judging by the Finanical Times report Kathryn noted, there could be some parsing in this denial:

Tony Snow, White House press secretary, said there was “no debate right now” within the administration about taking immediate steps to withdraw troops from the battlefield.

It’s not as though there hasn’t been other reporting besides from the Times about the internal administration debate. This was from the Wall Street Journal prior to the holiday:

Defense Secretary Robert Gates and some allies in the Bush administration are seeking to build bipartisan political support for a long-term U.S. presence in Iraq by moving toward withdrawing significant numbers of troops from Iraq by the end of President Bush’s term.
The complicating factor is how long the administration will stick with its “surge” strategy of keeping high levels of troops in Iraq to try to tamp down violence there. On this issue, the administration — and even the military — is deeply divided.
The longer the surge lasts, the harder it will be to achieve the longed-for political consensus. Without such agreement, Bush administration officials fear, the U.S. could be forced into a hasty withdrawal that could have dire consequences both for the region and for U.S. stature in the world.
What Mr. Gates and some other high-ranking administration officials have in mind is a modern-day version of President Harry Truman’s “Cold War consensus,” a bipartisan agreement on the need to contain the Soviet Union…
The emerging plan would shift the U.S. mission in Iraq to a more-modest attempt to contain its civil war, rather than the current effort to end the conflict. A smaller force of American troops, operating out of large bases far from Iraq’s major cities, would focus on battling al Qaeda, securing Iraq’s borders and training the country’s struggling security forces.
The approach represents a stark shift for many senior administration officials, who have gone from arguing to maintain existing troop levels in Iraq — if not increasing them, as with the surge — to embracing a large-scale withdrawal as part of a shrinking of the overall U.S. mission there.