I have been thinking about this since Skyping with a mentor earlier today.
1) Saakashvili was going for broke, thinking he would override forces (separatists and Russian peacekeepers) in S. Ossetia. His swollen military budget (and ego) and friendship with the West gave him a false sense of power. He thought he could get the Russian border ahead of Russian re-enforcements and consolidate. Maybe he also underestimated Russian resolve to control the province. Finally, he may also have counted on a strong NATO/US/EU response to Russian retaliation, forcing the Russian forces back.
or...
2) Saakashvili made this move to enhance his own power, and consolidate his position within the Western hierarchy. I came to this thought because what the end effect of his actions are, at this point, is an exposure of the West's inability to exert any control over Russia in this region. It is plain for everyone to see that Russia can regain its old Soviet sphere of influence if it felt the need. The speed at which Russian forces over ran the Georgians was rather shocking, particularly to the EU, which has some painful historical memories to a similar effect.
Ok, so what? how does this consolidate Saakashvili? Well, first off, it will play well to Georgians outside of S. Ossetia, because their leader fearlessly stood up and tried to reclaim what would be theirs. Second, it will likely re-invigorate the debate over admission to NATO. If Russia is able to so easily crush Georgia, it is clear that this territory is really their sphere of influence, and not the West's. Admitting Georgia into NATO would allow the West to beef up the forces there, and remove the State from under Russia's thumb.
So, was war the folly of one power hungry leader, or a shrewd Machiavellian move? Who knows... I'll never know all the details to really say. Plus, how would Russia react to Georgian NATO membership? Not well. The reaction would probably also manifest, in part, with a sudden drying up of energy flow into the EU.