It is not looking too good for Iran
I don't think that this bothers them all that much. It might bother the population, but not the circle of power in Iran. And they'll find ways to put all the blame on somebody else. Methinks what's happening now is pretty much what Iran wanted to happen all along. Well, at least its fucked up leaders.

Fact is, the west has no good options left: Sanctions will hurt the wrong people, an attack would cost the US what little sympathies are left in the Arab world and probably lead to retaliation. For instance, nobody wants Iran to shut down the strait of Hormuz, through which a large percentage of the world's oil supplies are transported. And the Iranians know that.