Said was a complex figure. His writings about Orientalism suggested that the sole purpose of Western study of Arab and Eastern culture was to try and sublimate it. There may have been some truth to that, but I always disagreed with that basic premise.
The net effect of his scholarship, regardless of its veracity, was to create a rich field of academic analysis on the ties between the East and West. Said's work always seemed to me to be an effective counterargument to the Lewis thesis of a Clash of Civilizations - much like Irshaad Husain and Sayyed Hossein Nasr, Said's work pointed (implicitly rather than explicitly) to the essential continuity of civilization between the Arab and Muslim world and the Christian West. As Jonah Blank wrote in his book, Mullahs on the Mainframe (an ethnography of my own sect, the Dawoodi Bohras) :
It is my hope that the portrait of the Bohra community presented in this study will help dispel some commonly held misperceptions about fundamentalist Islam. I do not argue that traditional Muslim values are identical (or even particularly similar) to those of modern Western society�merely that they can be compatible with so-called modern Western values. I would argue that the values Western triumphalists like to claim as their own (respect for human and civil rights, pursuit of social justice, equality of sexes, promotion of liberal education, aptitude for technology) are hardly limited to the West. And "modernity" (whatever its definition may be), is something far broader than a taste for sex, drugs, and rock 'n' roll.
Are the Bohras themselves an anomaly among Muslims? Whether or not they are representative of Islam's future, the Daudi Bohras shatter stereotypes about traditionalist Islam today. As a community of up to one million devout Shi�a whose faith is every bit as fundamental to them as it is for Afghans, Saudis, or Iranians, they present an example that must be taken seriously. While adhering faithfully to traditional Islamic norms, the Bohras eagerly accept most aspects of modernity, strongly support the concept of a pluralist civil society, boast a deeply engrained heritage of friendly engagement with members of other communities, and have a history of apolitical quietism stretching back nearly a thousand years.
Not all traditionalist Muslims are like the Daudi Bohras�but not all are so very different.
Jonah also rejects Said's thesis of cultural imperialism, arguing that (as his study of the Bohra community demonstrates) "what is needed is more cultural outreach rather than less. The best way to defeat ignorance is through knowledge, imperfect as such a search may be." I strongly agree.
However, as applied to the context of the Israeli-Palestinian struggle, I think that Said's work was critical. Said has made a determined effort to document the crisis of survival that the ordinary Palestinians, and their culture as a whole, faces while under assault from external and internal threats. Of course, his work was routinely and disingeniously interpreted to be an apologia for terrorism, when in fact Said had always been a staunch advocate of alternate solutions to the Palestinians' problems than violence. And his commentary has always been prescient.
While I expect Israeli partisans to crow about his death in due course, I think that his death is a net loss for the peace process. He was an optimist on human nature, and believed that the Israelis and Palestinians would indeed resolve their differences in the future. He was pessimist enough not to expect that resolution within his lifetime. He was right.
UPDATE: That didn't take long. Yourish: "One of the pillars of the development of modern anti-Semitism." And a follow-up. LGF: "Sad he wasn't taken out by the IDF." Idiotarian Dog: "filthy bastard apologist for child murderers." Surprisingly, Joe Katzman takes the low road as well, celebrating the fact (if not the method) of Said's death calling him "high in the councils of the enemy"
Judith Weiss of Kesher Talk provides a classy counterexample to the above.
UPDATE 2: Adil Farooq posts a strong critique of Said's Orientalist legacy at WindsOfChange, with excellent links. And Reason Online has a nice illustration of how Said's Orientalist perspective tinged his awareness of 9-11. For the record, Said's observations contradicted mine.
I should clarify that while I agree with Adil on his opinion about Said's Orientalism work, I separate that entirely from his writings on the Israeli-Palestinian conflict. The IP struggle is not about East vs West, or about Islam, or about cultural imperialism, it is a raw example of old-fashioned colonialism and imperialism which needs no broader subtext to understand. As such, Said's analyses were largely free of his Orientalist mindset.
 Aql: The Place of Intellect in Islam
 Science and Civilization