The good news is that a nuclear attack is completely survivable with no preparation except an alert mind and a will to live. Any terrorist nuke is almost certainly going to be a) small in size and b) limited to a few major cities.
The chances of the Muzis getting their hands on one of the ex=-Soviets' monster city-buster bombs (Yield ≈20 MT) are nil. Those weapons are mostly gone, and the ones that are left are under strict control (and would be impossible for a terrorist cell to transport anyway). Ditto their chances of building such a weapon from scratch -- they're too complex and require too much plutonium and other controlled material to make. This means that a terrorist group is going to be limited to something like a tactical nuclear weapon, i.e. a "small" nuke. A re-purposed Soviet tactical or antiaircraft missile warhead, a nuclear mine, or an atomic torpedo warhead could be turned into a terrorist weapon with minimal modification.
What could such a weapon be like? Since data on Soviet tactical nukes can be scarce, I'll use a U.S. tactical nuke as an example. The W-45 device was a steel barrel 11.5" wide by 27" in diameter, massing from 150 to 350 pounds, and having a variable yield ranging from .5KT to 15KT. Assuming the Muzis could get one and figure out some way to detonate it, something like the W-45 would be ideal for their uses. It could be transported in a van, pickup truck, or the hatchback of a Honda Accord. However, the most likely mode of transport would be to put it in the center of a standard over-the-road freight trailer, surrounded by heavy material to absorb the weapon's neutron radiation "leakage" and lessen the chances of its presence being discovered by freeway and helicopter-borne radiation detectors. Once in the country, the unit's firing circuit could be wired to a barometric altimeter and the whole unit placed into a light aircraft for transport to the target.
For an example of what such a weapon would do, look no further than the Nagasaki bomb. Exploded on 9 August 1945, the weapon exploded at an altitude of 469 meters (1,540 ft) with a yield of 21KT. Everything within one mile of the ground zero was vaporized or turned into dust. Every combustible object (and person) within three miles was burned instantly to a crisp, set on fire, or severely burned. The blast killed about 80,000 people, not counting fallout-related deaths (of which there were not many).
Now imagine that blast going off over a typical American city. I'll use Arlington, Texas as an example. Let's assume a Nagasaki-type airburst. The damage plot looks like this:
Everything within the red circle (1 mile radiuss) gets destroyed, either vaporized or smashed into powder. A few of the heavy concrete structures at the University of Tezas at Arlington remain standing, but their walls are blown out and they are gutted and unsound. Few within this area survive.
Within the orange circle (roughly 2 miles from GZ) everything is on fire. This includes all the government buildings in downtown Arlington, the neighborhoods surrounding the center city, and basically everything in Central Arlington. The Masonic Retirement Home at Fielder and Division is ablaze along with its orchards; the Arlington Memorial Hospital complex at Randol Mill and Cooper is wrecked and burning as well. Many dead and dying rein this area; sadly, blocked roads prevent most outside help from reaching them.
Within the yellow area, most structures still stand, but many have sustained heavy damage and many are on fire. The Parks Mall at Cooper and I-20 is standing, but glass from its overhead skylights has fallen, injuring and killing many shoppers. The Jerrydome and the Ballpark suffer major roof damage, but remain standing and sound; the city's natural gas power plant, water works, and sewage plant have all survived as well. Since this is an airburst, little fallout is produced, but what there is will travel more or less along the same path as the prevailing winds (gray arrow) towards Dallas, some 25 miles away.
Survival in such a disaster would be possible, even for those in the red area. Believe it or not, "duck and cover" actually works. As long as one is not directly exposed ( = line of sight) to the fireball during the explosion and immediately afterwards, one stands a fighting chance. By taking cover in a ditch, culvert, or any other below-ground place at the first instant they react to the flash, a person could survive the blast itself as close in as a thousand yards or so. (Any closer, however, and pretty much everyone will be burnt and crushed to death no matter how they react.) Outside the red area, the main threat is from fire and flying debris -- glass, building materials, etc. Again, taking shelter at once can save lives.
As bad as this event would be, it would not mean the end of the country, Texas, the DFW area, or even Arlington. While the death count would of course be horrific, the radiation levels would be low, and outside help could enter the city immediately. Rebuilding could begin within weeks.
Of course, if a bigger bomb were used, or if the bomb were groundburst, the story would be different. But I think these local threats would pale compared to the psychological shock effect upon the nation. That is where the true danger lies.