The main concern that some schools have with graduate students is whether or not they can finish their degree before matriculation. If it's obvious that you won't be able to finish, and the school even cares, then yes it would most likely be a problem. On the other hand I know of examples where MS students were accepted and were under no obligation to complete their degree. Bottom line is that every school is different.
Without a doubt I would suggest that you begin your MS with every intension on finishing (not that you aren't). Not having the time to finish and never having the intension to do so are two very different things. If you plan to start this fall then you can diffinetly finish before fall 2004. Good luck.
I happen to be in the same situtation (applying with one graduate semester left), but I can't offer any insight as to how you'll be preceived (still waiting to hear from schools). But I would imagine that our situtation is similar to an undergraduate in their junior year who is applying.
