I'd say NATO views this not as a failure but as a success: this is how they wanted it for Serbs and other non-Albanians. Didn't former Secretary of Defense Cohen say something to that effect - about how Kosovo would be made a very tough place for Serbs to live? KFOR and the UN allow the Albanians to freely attack and cleanse the province of non-Albanians and either fail to arrest or only temporarily hold those Albanians who commit even the gravest crimes - such as the multiple murderers and terrorists (remember how the Albanian behind the bomb attack on the bus which killed about a dozen, including a 2-year-old, "escaped" from Camp Bondsteel).
The few remaining Serbs will be taken care of eventually by the Albanians when the mission is scaled back. If they would have allowed returns of Serbs in great numbers, the Serbs could stand a better chance to organize a defense from future attacks. The Serbs haven't been permitted to come back in significant numbers and aren't given adequate aid to rebuild, therefore the remaining ones are in a weakened and extremely vulnerable state - this no doubt is known to international policy makers shaping the Balkans. I'm saying they allowed Serbs to be whittled down to a small amount such that will cause no problems against their total complete annihilation. The remaining Serbs are essentially in jail and on death row.
ABrit, here is some news about the 13 tanks I mentioned the other day:
Although Shea boasted of NATO pilots "killing" over 150 armoured vehicles, it was later confirmed that only 13 Yugoslav tanks were destroyed during the fighting.