The 1986 legislation may have made Obama a Citizen, but it did not make him a Natural Born Citizen.
I am not questioning whether Obama is a Citizen. Arnold Schwartenegger is a Citizen, but he is not a "Natural Born Citizen". And if Obama was born outside the United States and his father was not a Citizen, then Obama cannot be a "Natural Born Citizen".
Your status at the time of your birth is what determines whether you are a Natural Born Citizen.
If Obama was born outside the United States, then by virtue of the 1961 Supreme Court decision in Montana v. Kennedy, 366 U.S. 308 (1961) Obama would not be eligible to take the office of President.
But when you look at the British meaning, it refers to citizens by birth, and it makes sense that those who are not "natural-born" would be those who are "natural-ized"...clearly, even this layman can see that he would not require naturalization, and falls under the "by birth" section of 8 USC 1401.