The US Constitution allows the President to "fill up all vacancies that may happen during the recess of the Senate, by granting commissions which shall expire at the end of their next session." (Art 2 Section 2 Clause 3). This seems to be an exception to the general principle that "by and with the advice and consent of the Senate (he) shall appoint ambassadors..."
President Bush's use of recess appointments has been controversial, even if it is not unconstitutional - but the withdrawing of Sam Fox's nomination to be Ambassador to Belgium when it faced likely defeat in the Senate; followed by the recess appointment days later in a short recess has angered many. Senator Dodd has made the following statement
“It is outrageous that the President has sought to stealthily appoint Sam Fox to the position of ambassador to Belgium when the President formally requested that the Fox nomination be withdrawn from the Senate because it was facing certain defeat in the Foreign Relations Committee last week. I seriously question the legality of the President's use of the recess appointment authority in this instance. I intend to seek an opinion on the legality of this appointment from the Government Accountability Office (GAO) and invite other Senators to join with me in that request. This is underhanded and an abuse of Executive authority -- sadly this behavior has become the hallmark of this administration.”
This will be an interesting story to follow!