AS THE UNITED STATES, Israel and Egypt prepare for their foreign ministers meeting this week in a castle outside London, a brief wrap-up of the latest reports from the Mideast peace front is in order:

The government of Prime Minister Menachem Begin is bringing to the meeting a 26-point peace plan that the Egyptians find unacceptable. Egypt's President Anwar Sadat will be sending his own six-point plan, which the Israelis have totally rejected. Yet another peace plan, drawn up by - who else? - Austrian Chancellor Bruno Kreisky and Willy Brandt, the leader of West Germany's Social Democratic Party, was put forth in Vienna last week for presentation to a forthcoming meeting of the Socialist International in Paris.

It was immediately embraced by Mr. Sadat, denounced by Israeli Foreign Minister Moshe Dayan, and warmly welcomed by former Israeli foreign minister Abba Eban.

Also in Austria, Mr. Sadat met last week with Shimon Peres, of the Israeli Labor Party opposition and with Ezer Weizman, who is Mr. Begin's sometimes dissident defense minister. According to a Reuter's dispatch, he was not cheered by either meeting. Just before leaving home, he complained that "it's only us who are making concessions - the Israeli never make concessions."

But hours later, the Associated Press quoted Mr. Sadat on his return to Alexandria as saying that his Austrian visit had been "more than a success from my point of view, and let us hope that in the near future there will be concrete results." Egypt's Vice President Hosni Mobarak, on hand to welcome his president, ventured the view that "there is a little bit of flexibility in the Israeli side.

Meanwhile, in Jerusalem, Mr. Begin was being quoted as saying that Israel had brought nothing new to Austria and Israeli officials were apparently insisting that Mr. Dayan would bring nothing new to London. And yet the same dispatch, from The Post's Yuval Elizur, said Israeli officials (also unidentified) were so optimistic that they were predicting a "continuing dialogue" between Israel and Egypt even if this week's London meeting produces no progress.

The confusion and contradictions here strike us as a healthy and promising sign. They are almost certainly evidence that some kind of quiet backstairs bargaining is going forward and that some progress is actually being made. The forthcoming conference of U.S., Israeli and Egyptian foreign ministers, for example, will probably try to separate out the promising areas for agreement and identify the obvious areas of disagreement in the respective Egyptian and Israeli proposals, rather than get down to hard bargaining. But in terms of general principles and means of procedures - as distinct from the sort of material progress or "breakthroughs" that onlookers will be straining to find, or to find missing - the meeting will probably move the process along to some future agreed-upon follow-up conference in a less conspicuous locale, such as the isolated Sinai desert town of El Arish, which was actually Mr. Sadat's first choice.

And then what? Another Weizman-Sadat encounter is already scheduled in Alexandria. After that, there is likely to be more of the same, including more confusion and contradictions, more use of quiet back channels, but nothing anytime soon as electrifying as the Jerusalem drama that initiated the latest phase of Mideast peacemaking. And that, in our view, is all to the good. For the trouble with Jerusalem, and the reason that it so quickly foundered into impasse and bitter recriminations, was that it attempted to lodge at the highest level a process that was always going to have to be worked out, not in a love seat in front of American television cameras but in hard, discreet bargaining on all the tough questions having to do with defensible boundaries, and the precise evolution of the West Bank in slow stages toward some form of autonomy that does not endanger the security interests or foreclose the aspirations of all the parties involved.

That, it seems to us, is what is happening now. And if it lacks the clarity and simplicity of last November's promises of "no more war" and "real peace" from Mr. Sadat, and the large-minded answering pledge from Mr. Begin that "everything is negotiable," it at least expresses in its own garbled way the essential spirit of Jerusalem: a mutual interest in movement, however halting and fumbling - a desire on both sides to do something to deal with the impasse and the stagnation that are real threats to stability in the Middle East.