Well, that's a nice twist. Hitler had a penchant of throwing away his troops in useless "hold at all cost" orders.
With Hitler out of the way and the Kursk offensive stillborn, the next move I think would be for the Germans to consolidate their lines, even giving up ground for time to reconstitute their forces.
Looking at it from a purely military point of view, doing so might extend Germany's ability to wage a defensive war but still in the long run, Germany still wouldn't have the resources to win.
Even if we include the political aspect, I tend to think that the Allies and the Soviet Union wouldn't be amenable for any negotiations. However, I wouldn't close the door on this since when it comes to politics, personality quirks are involved.

The only chance I think Germany has of stopping the Russian juggernaut after Hitler is assassinated is to surrender but insist on stopping on the current battle lines, followed by a phased withdrawal to prewar borders. Doing so would allow the Allies to send in its own forces further east and reduce the USSR's advance into Europe.

However, such an action would open up the perrenial problem of Germany and the Allies going up against the Russians. Given the mentality of Stalin, he would move heaven and earth to demand his share of the pie and the Allies would have a big problem of accomodating his demands. It boils down to this, would the Allies risk going to war with Russia over Germany's early surrender? I think not.