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The compromise seems unlikely too, so what is left? It depend on the choice of the West - if Western countries will proceed with recognition without Serbia's consent I think Russia after some time will unilaterally recognise some de-facto independent states which she will consider worthwile (of course Georgian regions will be the first) and will invite third world countries to do the same.
As the West has more friends in the world, Kosovo will gain recognition easier than Georgian breakaway provinces but with hurdles - remember Taiwan had occupied China's seat in UN several decades before Kissinger's ping pong diplomacy. The same will be fate of Kosovo - long long waiting before formal recognition in UN.
What about Georgian republics? They will be in position of Turkish part of Cyprus or somewhat better as Russia wields veto-power in SC. About recognition of these countries by third world countries - I don't know, Hugo Chavez (and other anti-Western leaders) or former Soviet republics which are very close to Russia may well be the first to follow Russian recognition. Iran's reaction may be interesting as well.
I see only one possibility of indirect military confrontation between Russia and the West - Russia's recognition may provoke Georgian leaders to launch fresh offensive against breakaway regions. There may be piquant situation if Georgia is admitted into NATO before this happens. Direct Russian-Georgian war is hardly possible but Russia already did a lot to arm and train secessionists to defend themselves.
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