Obama breaks with Israel at UN; Palestinians kick sand at Obama anyway

U.S. Agrees to Rebuke Israel in Security Council  -Colum Lynch

The U.S. informed Arab governments that it will support a UN Security Council statement reaffirming that the Council "does not accept the legitimacy of continued Israeli settlement activity," a move aimed at avoiding the prospect of having to veto a stronger Palestinian resolution calling the settlements illegal.

But the Palestinians rejected the American offer and said they are planning to press for a vote on the resolution. 

[T]he U.S. offer signaled a renewed willingness to seek a way out of the current impasse, even if it requires breaking with Israel and joining others in the council in sending a strong message to its key ally. U.S. officials were not available for comment, but two Security Council diplomats confirmed the proposal.
(Foreign Policy) 
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UPDATES:

U.S. Offers Rebuke to Israel -Richard Grenell

[A]s foreign policy experts hail the region's recent democracy movement, Rice is at the UN agreeing to condemn the Middle East's strongest democratic government.
(Huffington Post)
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Assessing the Post-Veto Fallout -Jonathan S. Tobin

Obama followed in the footsteps of his predecessors and refused to allow the UN body to brand Israel a criminal lawbreaker. But the unnecessary explanation given after the vote that branded the Jewish state's position on the issue of settlements as "illegitimate" undermined any notion of U.S. support for Israel.

Had the U.S. not vetoed the resolution, it would have been the final signal that this administration really was determined to cut loose the Israelis. But by showing that the veto was cast reluctantly and with ill will, the effect is not much different.
(Commentary)
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Abbas Prefers Posturing to a Peace Process
-Editorial

The Obama administration has all along insisted that Abbas is willing and able to make peace with Israel - despite considerable evidence to the contrary. If the UN resolution veto has one good effect, perhaps it will be to prompt a reevaluation of a leader who has repeatedly proved both weak and intransigent.
(Washington Post)
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Did U.S. Veto Hinge on One Word?  -Joe Lauria & Charles Levinson

President Obama telephoned PA President Mahmoud Abbas, offering to either adopt or abstain on the resolution if the Palestinians agreed to replace the word "illegal" with "illegitimate" in reference to the settlements, according to a person briefed on the call. But Abbas refused.
(Wall Street Journal)*