Well he's not going to get the Peace Prize no matter what happens. A state, particularly on GWB's terms, sovereign and with an Arab veto over any changes to the 1949 lines, would be a major victory for the Arab regiemes in the region. They can't be sure the next administration will buy into those concepts, none of his predecessors have, so the time for the Saudi's to apply any pressure they have is now. Beyond that, having commited to the concept, he may not want to back out. The fact is that no one cares if the palestinians carry out their obligations.
IMO, if he wants his finger in the pie, the best thing to do would be to insist on at least the preliminaries, dismantle and disarm the terrorists and stop media incitement, then come to us for money.