It seemed like routine bureaucracy when Acting Gov. Blair Lee III dispatched a handful of state corrections officials last month to examine an empty warehouse in Baltimore. Only his closest advisers knew at the time that he was rethinking the most vexing policy of his short administration.

The prison officials were asked to evaluate whether the warehouse would be a worthy home for a state prison, a possible alternative to the 25-acre site already chosen (despite loud protests of neighbors and local politicians) for a new 890-bed maximum security institution in East Baltimore.

Lee's decision to send a scouting party did not bear results. The warehouse was not appropriate for a prison. But his decision to give it a try showed a softening of his once-adamant view that a feasible alternative could not be found to the site once owned by Continental Can (Con Can).

Last week, Lee called a group of reporters to his office and announced the thaw in his thinking. He was now willing to scrap plans for the Con Can site, he said, if another "acceptable" location could be found and approved at the current session of the General Assembly.

It seemed like a modest compromise, a small crack in the door. He was giving opponents of the Con Can site a last chance to change his mind. So as not to raise undue optimism, Lee told reporters he would be surprised if the opponents could pull it off.

Lee's new policy is a doubled-edged sword. If a suitable alternative site is found, he emerges as a hero of East Baltimore politicians who have waged a two-year battle against Con Can site. In the past year, they have picked up the support of several legislators from other parts of the city.

On the other hand, if correction officials reject the new proposals, Lee has no other choice but to go back to the Con Can site. Although he inherited the Con Can plans from the Mandel administration, reaffirming the plans will give the decision his personal imprimatur.

Even if Lee ultimately rejects the new proposals, he can at least say he gave opponents a generous opportunity to come up with an alternative site. He has been roundly criticized for the rigidness on this issue, which has beenperceived as insensitivity to neighborhood concerns.

Lee's subtle policy switch after months of intransigence has importance far beyond the issue itself. In politics, small ripples often presage big waves. The shift could greatly influence gubernatorial politics in Maryland and Lee's fate in this session of the legislature.

For the time being, Lee has found some middle ground on an issue that has forced him farther and farther away from some Democratic loyalists whose support he needs to run a smooth session and draw votes in a statwide election that could include Baltimore area candidates.

The bloc of Con Can opponents in the Baltimore delegation is large. It makes up an important part of the city-wide machinery that regularly turns out voters on election day. It is also vocal and powerful enough to influence the flow of certain legislation at the session.

Lee's accommdation with that bloc will be fragile until the issue is resolved. Baltimore Del. Charles J. Krysiak warned that his colleagues will begin blocking administration progtams within a short time unless Lee gives evidence that he is serious about finding another prison site.

In addition to promoting some political fallout, Lee's change of heart indicates that he has re-evaluated the work of state corrections officials who recommended the Con Can site after rejecting 54 other possible locations. He is known to have become wary of their conclusions.

Another event may have forced him to reconsider his position. Last month, Sen. Harry J. McGuirk, a pivotal figure in Baltimore politics, who helped push the Con Can measure through the last session of the legislature, changed his position and began arguing for a new site.

It was McGuirk, one of the legislature's most effective power brokers, who asked Lee to have the vacant warehouse examined last month. It was also McGuirk who exacted a promise from Lee to offer Con Can opponents a chance to propose alternative sites during this session.

McGuirk's swing behind Con Can opponents may have been a signal to Lee In legislative politics, it represented a power play. If the concerns of East Baltimore politicians were spreading to an influential South Baltimore figure like McGuirk, maybe they could go farther.

Though Lee's policy move is the most significant political event in this newly awakening session, it will take a while before a final assessment is possible. In the meantime, it has given pause to some gubernatorial opponents who were hoping he'd alienate parts of the Baltimore delegation.

In the opinion of some political observers, Lee was foolish to take the gamble. At best, they say, he wins back the support of political regulars who would eventually close behind him. At the worst, he will raise expectations and antagonize more people.

"I would knock down those buildings as fast as I could and start building the prison tomorrow," said one observer. "Just get it over with. There are only 250 people (who live around the Con Can site) who'll be mad at you and the rest of the city is breathing a sigh of relief."