I'm not too worried, despite George Bush's best efforts.
First, this guy in Iran sounds a lot like our own president when he demonizes an enemy of THEIR country. Inciting hatred of another country or leader = political popularity. I don't see that big a difference between him and any other leader. I think he's playing to his own people and not us, but thanks to world wide media we get to fret about it, which brings me to point #2.
If Iran gets a nuclear weapon, what are they going to DO with it? It's pretty much a given that we were spared WW3 because of the certainty of mutually assured destruction if we or the Soviets launched a nuclear strike.
If the lead dog in Iran didn't figure it out himself, I'm sure SOMEONE from the west has told him, "look pal, we in the west have THOUSANDS of nuclear weapons and you might have , what, ONE? You DO know, I hope, that if you use your one and only nuke the rest of us will turn your country into a sheet of glass, and YOU with it, comprende?"