Georgia is a distinct people, with a distinct language (both written and spoken). The Georgians are part of the "steps" or Caucasus. They were absorbed into the Russian republic proper about two hundred years ago (not willingly).
The Georgians are traditionally "horsemen", and used to freedom within the mountains. Though finally subjugated by the Russian Czar they kept their heritage tight and underground. In 1993/1994 they broke clean away from the weakened Russian Republic and turned straight to the US and other Western nations for help, education, and a hope to become part of Europe.
The Georgian military, though small compared to Russia's, has the advantage of both Russian military training as well as Western military training (they can think like both, and anticipate the actions of both). The majority of the "casualties" inflicted during the conflict, were caused by the Russians, while they "rolled over" (similar to a German blitzkreig), while the Georgian military strategically backed out. Their job was done. The world saw the Russians and their intent.
Who won? That remains to be seen on the ground level, but in the mind of the world, the Russians came away with "egg" on their collective face. Had they stopped at the disputed cities, this would not be the case. However Russians have a tendency to be a bit over zealous, and not so subtle. This is a PR disaster for them, as they were trying to convey themselves as civil and enlightened, and a police force for the area. Instead, they are looked upon with dismay and distaste...something they can ill afford.
They are also very concerned that their "fear factor", did not sway western allies in coming to the aid of the Georgians, nor did it frighten the Georgians.
The Georgians for their part, took drastic measures to get the world's attention, however were brilliant in their Spartanic maneuver, of drawing the Russians into the "canyon" as it were, then screaming for the neighbors to come look at what was being done.
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