Time as always, will of course tell what ultimately develops.
Back to the Kosovo point, neither side, NATO or Russia, is leaving any wiggle room or exit points except direct (military) confrontation, which by all indications, seems exactly what Vladimir Putin seeks.
Article: Russian Dictatorship - Putin's Democracy Coup
http://www.opednews.com/articles/opedne_brock_no_071217_russian_dictatorship.htm
Rather, in the bigger "global" picture, the event acts as the catalyst or trigger point to formally spark or accelerate the movement towards Cold War II, as China and Russia in resounding fashion denounce the Kosovoian move and any other potential separatist states on their fringes around the world, waiting in the wings. For example, it's hit a raw nerve with China, causing further stress between Taiwan and China, as Taiwan quickly recognized an independent Kosovo, and China quickly responding that Taiwan was in no position to do so. Then the other end of the spectrum, even NATO countries might be in a "separatist pickle" with recognizing Kosovo. Consider Canada's headache with potential separatist state Quebec, and related "rock and a hard place" dilemma with recognizing Kosovo, or not.
Then there are the 60 or so members in the Unrepresented Nations and Peoples Organization (UNPO) who are following these ground breaking developments intently. This organization's members comprise indigenous peoples, occupied nations, minorities and independent states or territories which lack representation internationally (i.e. UN). Many have separatist tendencies. It's a ranging member mix, including for example Tibet, Taiwan, the Lakota Indians in the U.S., and even Kosovo.
From Russia and China's perspective, they publicly view the Kosovo action as a threat, perhaps the tip of a separatist iceberg with many of their own fringe, yet active separatist seeking states, and have begun to circle the wagons. That makes them dangerous. To the contrary, the major NATO powers roundly applaud the move, greatly increasing the friction with Russia and potentially setting in motion the Analyst's previously outlined (Commulism Series article) Cold War II inspired global re-alignment. (Note: You can view every article as one long page if you sign up as an Advocate Member, or higher).
Note: One must believe that the instantaneous recognition by major NATO powers suggests the Kosovar leadership had NATO pre-approval for the action, and confirmed West support. The question then becomes, should the effort have been instead encouraged and slugged out in the U.N. rather than just arbitrarily NATO approved, afterall there is an existing UN resolution 1244 (1999) outlining all the specifics? More on that later.
The winds of formal alignment commitment/change had been swirling, just waiting for a spark to ignite the fuse. This could be it, with Russia's (and China's) paranoia with the Kosovo move not unlike that which they exhibited toward the West in general, during Cold War I. This further exacerbated by post Cold War I NATO acquisition of many of the former Soviet Union republics and eastern European (Warsaw Pact) countries. Too, Russia sees Kosovo in a sense as losing (part of) an ally, in the form of a lost piece of Serbia, a nation seeking deeper ties with Moscow. In fact as Wikipedia notes, "In 2007, Tomislav Nikolic (deputy leader of the Serbian Radical Party) during his speech said he wished for Serbia to strengthen ties with the union and eventually join the Union."
Note: That Union he refers to is the "Union of Russia and Belarus". Consider this "Union" the embryo beginning of Soviet Union II.
To stem its perceived losses and preclude any separatist floodgate from opening, Russia now appears ready to draw a hard line in the sand on Kosovo, with China in full support.
Russia adding the ominous threat of military intervention to the mix, clearly compounds the standoff/crisis many fold. The U.S. and WEAST (U.S. West and EAST allies), in this case NATO/EU, would presumptively oppose any Serbian military intervention to tamper with or halt Kosovo independence, thus drawing in NATO (rather than more UN) troops. Looking at history however, the 1998 Balkans War was NATO vs. Serbia. Does NATO really yet recognize the increasing likelihood or have the stomach to now go NATO vs. Russia, if Russia remains steadfast in its threat? And for reasons below, it likely will.
Note: The Russians "appear" itching to get it on with NATO. Why?
For 1 of two reasons (maybe even a combo):
1. It's not a bluff – i.e. military intervention:
NATO need quickly adjust its assessment and understand this may not be a Russian bluff, at all. To discount it as such sets the stage for potential disaster. The Russians have little to nothing to lose and much to gain in a very contained, localized, in and out street fight with NATO. Regardless of NATO's "global" military superiority versus Russia's, it means nothing in a confined space like Kosovo/Serbia, where the Russians can easily amass an equivalent or even superior concentrated force. Analogously think the famous Greek battle of Thermopylae where 300 Spartans in a strategically, localized and confined space held off 100,000 Persians.
At best, NATO can hope for (once it realizes it's headed for) in such a conflict is a draw, since it would be condemned by the rest of the world to broaden the conflict beyond Kosovo/Serbia borders, where NATO could exercise its greater muscle and flexibility. In fact, driving then issue to the U.N., which it has tried to avoid, and the Russians want. The Russians therefore see their downside in such an engagement as zero. A draw is great. A win even better. Either way, NATO loses.