On the one hand, of course, it makes Bush's PR job somewhat easier, because he can point to this as being merely a tough inspection regime and say "see? Saddam doesn't want inspectors to succeed". There's no doubt that the Echo Chamber is going to look at it the same way as well; it's the one most in harmony with their own position, and God forbid that they should believe an inconvenient analysis.
On the other hand, however, it doesn't necessarily have to be seen that way. There's no doubt that Iraq (and rather a lot of states around the world, including perhaps the U.S. itself) see it as a trojan horse- an ultimatum that is calculated to ensure that even if Iraq cooperates, the U.S. will use it to invent some plausible reason for invasion. That requirement for "full documentation", for example, could easily be screwed with, and there are likely dozens of ways in which that "inspections at any time in any place" could be manipulated to ensure that Iraq would say "no".
(The requirement for diplomats from the five security council members could be a problem as well, as Iraq would likely think that they would all be intelligence plants, if not assassins. Iraq might even be right.)
In that case, than the Iraqi reaction makes sense, simply because they know that they're just playing the part of Serbia prior to WWI, which knows that it cannot agree to Austrio-Hungary's terms and knows that the ultimatum has been deliberately crafted to ensure that. They can't possibly survive by complying to this.
My own personal opinion on this is not that Iraq is now somehow being proven as unreasonable, but that they shouldn't have shouted it to the world but instead kept a low profile. It's very unlikely that the European and Asian contingents in the Security Council would have bought into this, because they know quite well what it's really supposed to represent and want no part of it. They also know that the UNMOVIC meeting with Iraqi officials is scheduled for tomorrow, and that there was no reason for the U.S. to push this thing before the negotiations about real inspections came to pass. The U.S. would likely lean on them, but they know that if the oil spigots get turned off in Iraq, Iran, and Saudi they'll be the ones that suffer, not the U.S. (which doesn't get a lot of its oil from the region.)
What really bothers me though, are the tidings to Iran. Not because I think that Iraq is actually going to successfully draw Iran into this (they simply don't like each other enough), but because it may be the first domino falling in a chain polarizing the entire region's governments against the west. I'm sure that Al Qaeda would love that.
Edit: Hesiod responds:
Why not require Saddam to dress in a bras and panties, and do the dance of the seven veils live on Al Jazeera, while we're at it?True, but it does make sense... without that sense of urgency on Iraq, Bush's buddies in Congress would be strung up by his own economic policy. Makes me wonder... would we still be having this debate even if 9/11 didn't happen? Was invading Iraq close to an election always the plan after all?
It took Bush SEVEN MONTHS to figure out his Stem Cell policy.