  Using high resolution cosmological hydrodynamical simulations of Milky
Way-massed disk galaxies, we demonstrate that supernovae feedback and tidal
stripping lower the central masses of bright (-15 < M_V < -8) satellite
galaxies. These simulations resolve high density regions, comparable to giant
molecular clouds, where stars form. This resolution allows us to adopt a
prescription for H_2 formation and destruction that ties star formation to the
presence of shielded, molecular gas. Before infall, supernova feedback from the
clumpy, bursty star formation captured by this physically motivated model leads
to reduced dark matter (DM) densities and shallower inner density profiles in
the massive satellite progenitors (Mvir > 10^9 Msun, Mstar > 10^7 Msun)
compared to DM-only simulations. The progenitors of the lower mass satellites
are unable to maintain bursty star formation histories, due to both heating at
reionization and gas loss from initial star forming events, preserving the
steep inner density profile predicted by DM-only simulations. After infall,
tidal stripping acts to further reduce the central densities of the luminous
satellites, particularly those that enter with cored dark matter halos,
increasing the discrepancy in the central masses predicted by baryon+DM and
DM-only simulations. We show that DM-only simulations, which neglect the
baryonic effects described in this work, produce denser satellites with larger
central velocities. We provide a simple correction to the central DM mass
predicted for satellites by DM-only simulations. We conclude that DM-only
simulations should be used with great caution when interpreting kinematic
observations of the Milky Way's dwarf satellites.
