President Bush's overture to Iraq to hold high-level talks has injected a fresh element of uncertainty and risk into the Persian Gulf crisis, raising questions about the circumstances under which the two sides are prepared to meet and how much they are willing to discuss before resorting to war.

Yesterday, the State Department announced that Iraq had agreed that any meetings with the United States would be strictly bilateral rather than include outside parties as Bush at first proposed. Officials said the administration reconsidered its offer and sought to limit the participants in order to head off Iraq's suggestion that Palestinians be included and larger Middle East peace issues discussed.

The officials said they believe it will be difficult for Iraqi President Saddam Hussein to refuse to talk with the United States. But they do not know if he will seek to attach conditions. Saddam has yet to formally agree to Bush's proposal that Iraqi Foreign Minister Tariq Aziz come to Washington and Secretary of State James A. Baker III go to Baghdad for discussions before Jan. 15, after which the United Nations Security Council has authorized the use of force to push Iraqi troops out of Kuwait.

Although U.S. officials have stressed that the talks are not to be negotiations, both Bush and Baker have dropped hints in recent days that the discussions could range well beyond the basic U.N. demands for Iraq's withdrawal from Kuwait, release of hostages and restoration of the legitimate government of Kuwait. Some private analysts said yesterday the risk is that the talks could spin out of control and lead to enormous pressure for the anti-Iraq alliance to abandon its position.

"I hope we're prepared for the curve balls Saddam is going to throw at us," said Peter W. Rodman, a former National Security Council and State Department official now at the Johns Hopkins School of Advanced International Studies.

Saddam, he added, "is not going to play into our hands. I think he's going to come at us with peace proposals that are deceptive, that distract from the main issue, but are going to be very troublesome to deal with. It's relatively easy for us to deflect these kinds of proposals when he's making them unilaterally, but this kind of dramatic meeting, with the whole world holding its breath, is a different affair.

"The pressures on us will be overwhelming to give it a chance," Rodman said. "Why not a Middle East peace conference? Maybe military de-escalation?" Rodman said the challenge for the administration will be to anticipate that "Saddam will have tricks up his sleeve," to "consult like mad with the allies" and reject "anything that is a compromise of our principles."

Senior administration officials acknowledged that Bush's offer could open a confusing and difficult new round of diplomacy that would be hard to control, at least from a public relations aspect.

For example, one official said, what if Saddam asks Baker to come on Christmas Eve, or decides that the only day he can see Baker is Jan. 14, just before the U.N. deadline, then tries to stall for time? Moreover, this official said, there is certain to be a fog of fresh initiatives.

"There is no doubt in our minds that Tariq Aziz will come here and raise the Palestinians," linking resolution of their conflict with Israel to the gulf crisis, "and there is no question what we will say in response," said one official. "It's going to get him nowhere, but he may be able to use the film footage."

Bush emphasized when he announced the overture to Saddam that any talks would have to be "within the mandate" of the U.N. resolutions. But in the last few days, he and Baker have sent signals to Saddam that the diplomacy could be quite wide-ranging.

Even more significantly, Baker suggested this weekend that the United States was not trying to destroy Saddam.

When the Iraqi president had asked earlier for assurances that the United States would not invade his country or attack him, the Bush administration remained ominously silent about its options, hinted that it wanted Saddam toppled, or -- in the remarks of Gen. Michael J. Dugan, the former Air Force chief who spoke openly of bombing Baghdad -- threatened annihilation.

The anti-Iraq alliance also has threatened to curb Iraq's quest for weapons of mass destruction and to make Saddam pay reparations for damage done to Kuwait. Some have suggested he be tried for war crimes. Baker in September also raised the prospect of a new "regional security structure" when the crisis is over to contain Saddam.

But in a television interview Sunday, Baker offered assurances that if Saddam met the demands of the United Nations, he would not be attacked. Officials said this was a deliberate shift in emphasis by Baker to suggest to Saddam that talks with the United States could have some value and that war was not inevitable.

Baker said there was still "concern" about Saddam's chemical weapons stockpiles and nuclear capability, but the secretary of state did not reiterate the earlier threats against Iraq.

Alexander George, a U.S. Institute of Peace fellow and Stanford professor, said Bush and Baker are following one of the classic axioms of diplomatic gamesmanship. "The rule of the game of crisis management is never put your adversary in a corner from which there is no line of retreat. If you corner the rat, he can do desperate things. At the very least, there must be some kind of face-saving."

George said Bush's offer to Saddam was "an excellent and very useful thing" to demonstrate interest in direct communication and stanch rising criticism at home. But he said the gesture alone did not reveal how far afield the talks might go. "We don't know whether Bush and Baker have a fallback position, to get an agreement whether they have concessions," he said.

"So far it has been strictly a stick" that Bush has wielded against Iraq by deploying U.S. troops in the gulf region and orchestrating passage of U.N. resolutions demanding Iraq's withdrawal from Kuwait, he added. "Is it going to be converted to a carrot and stick? What will the carrots be?"

George cited some parallels with President John F. Kennedy's handling of the Cuban missile crisis, in which he used the blockade, an ultimatum and concessions to force Moscow to retreat.

In the current period of jockeying, however, George said there are risks that Saddam will misread the American position. "One risk is that he won't believe us," he said. Given the rising domestic opposition to military engagement, "there is a real question whether Saddam will feel we can carry out our threat."

Michael Hudson, professor of international relations at Georgetown University's School of Foreign Service, said that even with the latest offer of talks, neither side knows how the crisis will resolve itself. "In game theory terms, they are playing a game of chicken here," he said. "To play it successfully you have to do everything possible to convince the other party you will not blink or you cannot blink. . . . At the same time, while you want to scare him, you don't want to make him so depressed that he thinks, 'I've got to fight this war anyway.' "