This sucker is definitely OMNI bound (i.e. the "point of no return" is several miles back), so we might as well get a few countable posts in before the move

My thoughts:
-95% of the message was intended for the domestic audience; this thread itself proves that much (e.g. in spite of a stated interest, RichardinSF wasn't exactly showered with parade tickets by PRC official lurkers)
-the military might thing was largely intended to: 1) trigger nationalistic emotions among Chinese citizens; 2) reassure these same citizens that their government is bad[bottom].
-both 1 and 2 above are important because BJ's actual reach really isn't so great; the perception of power is critical to maintaining the status quo

This week's Economist (freely viewable online, so I won't bother to post links/snippets) has a pair of decent articles on the topic. BTW, I'm not one of those people that swears by the Economist; it's just that in this case, their reading is quite similar to my own during my days as a student of all things China.