further down in the story, President Bush himself is reported to have wondered just why they called it off.
My guess is that our buildup in Iraq had AQ worried (this all occured at the same time that we were screwing around with the UN to get them to go into Iraq with us). I seem to remember that our danger alert level went right up around the time that Colin Powell went into the UN with his briefing, and the libs trashed President Bush and Homeland Security for playing games.....
Maybe they figured (and probably correctly) that we'd respond with a nuke in the case of a gas attack.
Yeah, but respond where? One strength of the terrorist strategy is plausible deniability. No country is convincingly responsible, and they are dispersed enough that a nuclear response isn't discriminating... it takes out everything, possibly raising sentiment for their "cause."
I find it hard to believe that nuking anything short of the Kaaba would have any effect, and I doubt we would have done that.