• THE ANNOUNCEMENT THAT HAD BEEN expected since December finally came last week: the Princess of Wales has reluctantly agreed to a divorce from the heir to Britain's throne. It signaled an end to a failed marriage as famed as any in history, the unexampled source of sustenance to the tabloid press and a wish-book chronicle that has nourished the fantasies of people on several continents for 15 years. The Establishment lost no time in expressing suitably pious sentiments. Said Lord St. John of Fawsley, a constitution expert and an unquenchable royals commentator: "My main feeling is relief. Insofar as there has been a War of the Waleses, it will enable both of them to remake their own lives."

    Nonsense. If anything, the statement demonstrated that the Waleses' war is far from over. The announcement came not from Buckingham Palace but from Princess Diana's press representative, Jane Atkinson. She said that after the divorce, Diana would be known as Diana, Princess of Wales (a common styling for a titled widow or divorcee), she would keep her magisterial apartment in Kensington Palace, and she would continue to be a part of all decisions regarding the couple's sons (the Queen has final control of Prince William's upbringing).

    The palace was not amused. Once again the court had been bested as Diana snatched the initiative and presented her side first. "The Queen was most interested to hear that the Princess of Wales had agreed to the divorce," the press office sputtered, presumably in an attempt at sarcasm. Title, domicile and everything else, the spokesman said, was still a matter of negotiation.

    Diana's legal team reacted quickly to the snub, threatening to break off negotiations if Charles' private promises were not honored. Diana told her favorite reporter, Richard Kay of the Daily Mail, that she had given the royals everything they wanted, "and they are still not satisfied. Now they are playing Ping-Pong with me." The palace lofted another ping, announcing that the Queen wished that discussions "be conducted privately and amicably."

    Not likely. The new bad feeling will complicate the bargaining and give the media yet another bonanza. Charles went about his public duties, but Diana abruptly withdrew from a fund-raising event for the British Red Cross, of which she is patron. Said Atkinson: "She is upset and decidedly sad."

    Kay describes the latest chapter in the Waleses' war from Diana's viewpoint. Pressured by his exasperated parents, Charles wrote his wife, implying that she was dragging her feet on the divorce that the Queen had urged upon them in December. Diana proposed a meeting at St. James's Palace. The Waleses were for once alone together. Charles' aides wanted a stenographer present but bowed to Diana's request for privacy. After what she claims is an agreement--though not on the financial settlement--she called the Queen and then Atkinson to make the announcement. She claims that Charles had agreed to the terms that she made public.

    This is one failed couple that will never be free of each other, both because their son will one day be King and because the press and the public seem permanently obsessed with them. Charles' future has been dictated from his birth, but the latest wave of Di-mania focused on speculation about what will become of her. Not only does no one know what her life will be like, it's hard to picture her as anything other than the world's most famous royal princess.

    One thing can be said with certainty: Diana will go on being famous. She will also probably continue some version of what she is supremely good at: working with disadvantaged or afflicted people. She knows this is her area of strength; that is why she has said she wants to be "queen of people's hearts." Lately, doubtless because of her stressful situation, she has not been very active, at least in the public eye. After the divorce she will need some kind of channel for her enormous energies. Her detractors never tire of saying that she will end up in Texas or California--precincts of hell to Establishment toffs--but that is unlikely. No one has ever claimed that Diana is indifferent to her sons, and she will continue to be based in England, if only because the Queen would not allow the heir and the spare to spend much time anywhere else.

    To see a future for Diana only in good deeds, however, is to ignore her other genius: the ability to surprise. Only a beclouded seer would limit her future to charitable work or any other single strand of activity. As she adjusts to the single life, she may explore options, possibly even commercial ones. Who knows--in health, fashion or, like Jackie Onassis, in publishing? Diana's siren song is, Stay Tuned.

    One thing no longer alive is the dream that dies so hard. Charles and Diana are two people who stumbled into a fantasy fervently embraced by millions. She embodied it; he was swept up in it, much against his will. When the so-called fairy tale began, all Charles wanted was more of what he already had: a comfortable life of conscientious royal duty, shooting, polo, painting pictures--and a nice, quiet double standard. But people may never forgive him for puncturing their dream.

    The divorce announcement, however muddled, only served to reopen the scrapbooks of memory, reminding people of the fairy tale that was too good to be true. The shy teenager in the diaphanous skirt. The wedding shot--he in his dashing dress uniform, she in her silly, billowing gown. He looking every inch Prince Charming, she gazing at him in rapture.

    The crown sent them forth to conquer the world, and they did. In just a year or so, they rejuvenated the royal family. Nights on television, mornings in the papers, there were pictures that made the rest of the news look meager and soiled: whirling around the dance floor in Australia with Diana's emerald necklace subbing as a headband, kicking up their heels at a White House ball and back home, kissing at a polo match. In her interview last November on the BBC's Panorama program, Diana spoke repeatedly about their effectiveness as a team. Was it intended as rebuke to her husband? Probably, but it was true.

    It became clear, however, that the magnet was Diana--accepting flowers, flirting with soldiers, falling asleep in public while pregnant or simply smiling. The Prince is an attractive enough chap, but notably unphotogenic. The camera worshiped his wife, and he became jealous.

    After a while it became hard to find any shots of the Prince and Princess of Wales together. In 1987 enterprising royals watchers figured out that between Sept. 16 and Oct. 27 of that year, they were completely apart. In the various confessionals written by partisans in the '90s, both partners emphasize that their miseries began early and speak of important misgivings before the ceremony even took place.

    Charles became alarmed about Diana's mood swings, her frequent tears and her obsession with his old mistress, Camilla Parker Bowles. But Diana was right. Charles had no heart to give her. It, along with a certain amount of sentimental jewelry, belonged to Camilla. Diana called her sisters to lunch just before the wedding and asked them if she might still get out of it. "Your face is on the tea towels, so it's too late to chicken out now," was the famous reply. The pity is that the bride could not ask the groom about whether they had any future together; they didn't know each other well enough.

    Still, the gossamer wedding, the fairy tale's foundation in reality, was a joyous event. Charles was happy because he thought he was pleasing his parents, particularly his father. Diana was happy because she had just received a buck-up note from Charles. He wrote of his pride in her and went on to give her some advice: "Just look 'em in the eye and knock 'em dead."

    It seems cruel to the rest of the royal family to point out that she did, and has been doing so ever since. The pretty girl became the woman who, in addition to being media magic, was embarking on a voyage of self-discovery. She learned that she could detect and respond to suffering. Increasingly, her public work concentrated on the sick and the troubled. When she offered an aids victim her ungloved hand, she advanced the cause of tolerance immeasurably.

    With gestures like that, she became a walking riposte to the palace, with its narrow, dated code of royal behavior. As has been pointed out many times, she was, if anything, a throwback to the Queen Mother, with her common touch and effortless rapport with ordinary people. When senior courtiers tried to limit Diana or downgrade her, they just looked pompous.

    What the Panorama interview made plain was that in ministering to the needy, Diana was helping herself. She had lost her emotional roots as a child of six when her mother bolted from Earl Spencer. Later, confronted with a shell of a marriage, Diana threw her enormous energies into the world of therapy. Often without publicity, she worked with battered wives and abused children.

    She also embraced therapies for herself, spending as much as $12,000 a year on colonic irrigation and aromatherapy. Though tabloid stories about her troubles have circulated for years, it was startling to hear the Princess talk freely in the Panorama interview about the times when she suffered from "rampant bulimia" and attempted to mutilate herself: "I just hurt my arms and my legs." Diana acknowledged her affair with James Hewitt, who authorized a tell-all book. The interview also revealed that she has mastered current pop-psych speak: alluding to other women who harm themselves physically, she said, "I'm able to understand completely where they're coming from." Though she claims to have felt worthless, she finally had the courage of her frailties. As usual, she put her message across: the television audience averaged a record 21 million, and polls showed that the public supported her overwhelmingly.

    Hell will freeze over before Charles says he knows where anyone is coming from. In matters of semantics alone, the distance between this royal pair is obvious. In any public speaking, he is reticent about personal references. The deficiencies in his upbringing are becoming clearer. In 1994, anxious to present his side of an increasingly difficult separation, he made a TV film and authorized a biography, both by British broadcaster Jonathan Dimbleby. Charles cited his distant parents, especially his authoritarian father, for some of his difficulties. Hardly a gentlemanly thing to do, but his point is underscored in a new biography, Elizabeth, by Sarah Bradford, a well-connected British author.

    As a little boy, Charles was left in the care of nannies, who were followed by the paramilitary masters of Gordonstoun school. In his day, Philip had conquered this remote Scottish outpost. He was a born leader and a natural athlete; his son was neither. Back at the palace Charles had to confront his little sister Anne, who had all her father's gifts and a confident personality. All Charles had was grit. After finally slogging through Cambridge and a stint in the navy that he found difficult, he had his own ideas about being the heir apparent, and they distanced him from his mother and sovereign. By the time he undertook the biographical film and the book, he neither consulted nor informed her of his plan.

    For a period in Charles' youth, Earl Mountbatten, Philip's uncle and a tireless meddler in the family's affairs, acted in place of both Charles' parents. After Mountbatten's death came such gurus as South African-born writer Sir Laurens Van der Post. If Diana turned to various therapies, Charles explored exotic lore, became a "green" and an organic gardener. Before long the tabloids had him talking to his carrots at Highgrove.

    Now Charles' circle is dominated by his mistress Parker Bowles; his foghorn friend Nicholas Soames, Minister of State for the Armed Forces; and Mountbatten's daughter Patricia. Perhaps the person closest to him is his private secretary, Richard Aylard, whose influence is extensive and widely questioned. In truth, Charles has the survival smarts of a baby seal. Aylard urged the Dimbleby project on him; his idea seemed to be that to know the Prince was to love him.

    Charles' reputation survived the TV show, but the book, Prince of Wales, in which the ditching of Diana and the complaints about his parents are spelled out, was a disaster from which he has not recovered. If Bradford is accurate when she writes that Charles returned to Camilla by 1984--three years after his marriage, before the birth of Prince Harry and presumably before the marriage became, in Charles' words, "irretrievably broken down"--the resurgence in popularity that his supporters predict will follow the divorce may be a long time coming.

    London School of Economics historian David Starkey calls the Waleses' marriage "one of the best-documented human relationships since the Greek myths." It's now clear that the union had little chance of enduring. Charles took Mountbatten's advice to play around for a while and then settle down with a simple, virginal girl. Says Starkey: "That's advice that might have been quite sensible in 1906, but somewhat foolish in 1980."

    As his marital disaster became apparent to him, Charles asked friends how he could have got it so wrong. The question now is, What can he do to get it right? His supporters believe he will redeem himself through good works. Trouble is that the unlucky Prince gives his all for admirable causes that don't seem to matter much to either his subjects or the media: inner-city projects, helping ethnic minorities, assisting new small businesses. On a recent foray to York to pursue some of his public-spirited interests, no national press accompanied him.

    Charles' larger problem will continue to be his private life. In Britain speculation about whether he and Parker Bowles will marry is obsessive. Constitutionally, there is nothing to stop them. Though Camilla has been reported to be a Roman Catholic, she is not; her former husband is. What Charles would require is his mother's permission; if she refused him, he could appeal to Parliament. As King he could wed without anyone's blessing.

    But there is something phony about these scenarios. What the heir to the throne can do is circumscribed by public opinion. To survive the royals must be acceptable, if not popular. The ubiquitous royal commentator Brian Hoey puts it this way: "Even though they were both guilty, all the blame in the relationship goes to Camilla. The people of Britain will never, ever forgive her, and that's why she will never become Queen. If Charles decides to marry her, he will no doubt lose the throne. Even though constitutionally nothing prevents him, the success of the monarchy depends upon the goodwill of the people."

    These truths are what causes all the talk of Prince William, 13, leapfrogging over his father. There is little doubt that Charles wants to reign--it's all he has ever trained for--but he will have to accommodate his private life to public expectations. Perhaps the most intriguing aspect of his personality is that it's hard to predict whether he will conform or stage a quixotic effort to win public opinion to his favor.

    By now, the Windsors are pretty much in disarray, even as books about them are becoming more dangerous. The most recent is the Bradford biography of the Queen (Farrar, Straus & Giroux), due out in the U.S. in April but excerpted in the London Times in January. Bradford, the author of several respected books, was considered a trusty by the palace, but once again the royals were wrong. Among her previous subjects is Elizabeth's father, the estimable, dull George VI. From that project she probably got some good sources for the new book. Beating Kitty Kelley, who has been working on a book reportedly centered on the Duke of Edinburgh, she offers speculation on Philip's romances. Her account of the woeful marriage between Princess Margaret and Antony Armstrong-Jones has moments of perverse comedy. At one point the photographer took to leaving notes where he knew his wife would find them. One read, "You look like a Jewish manicurist."

    Amid the burgeoning scandals, the question remains, Does it matter? The British are often tolerant of people's weaknesses and foibles. "The monarchy has not lost the support of public opinion," claims Vernon Bogdanor, Oxford's constitutional expert, and indeed, according to a Gallup poll, support for ending it has held steady at 15% for the past five or six years. Republicanism remains, as author Julian Barnes pointed out in the New Yorker, "a spindly growth." The Guardian, a newspaper that endorses it, ran a poll a year ago that showed support for a republic was in the mid-20% range. The monarchy exists by common law and Britain's unwritten constitution, but it could be abolished by an act of Parliament.

    It is indifference to the monarchy that has grown. This is partly because the country is more democratic and informal. But another factor may be that the royal spectacle is often not very edifying.

    What irks the likes of Soames and other vocal members of Charles' camp is that Diana's popularity is so far invulnerable. Media carping about her beauty and fitness regimens, her therapist Susie Orbach, her want of formal education, her abbreviated evening frocks, don't seem to have much impact. Nor does it seem to matter when critics fume that the Princess is expert in using the press and television to her own ends (as if Charles' staff and the Buck House operatives weren't trying hard for similar results). The immediate announcement of Charles' promises and the Panorama interview were Diana's brilliant pre-emptive strikes against the family and the palace's attempts to cast events in a light favorable to Charles.

    Each time Diana appeals to the public, the distinctions between her following and Charles' become more pronounced. Not only the Establishment but also those who aspire to it favor the Prince. He is, after all, at the top of the social order. The masses identify with Diana. She is the one who doesn't make them feel less than they are.

    As the royals and the world have learned, that statement was not quite on the mark. Diana is resourceful and shrewd. But in the short term, she faces a tough time. Estranged from the royals, she could find herself stuck with the media and little else. When Patrick Jephson, her private secretary for eight years, left, she lost perhaps her wisest adviser, and now she appears increasingly isolated.

    There will be more tit-for-tat scenarios, more struggles for what is perceived as the high ground. One certain sticking point is the amount of money Diana will receive. The figure usually mentioned is $23 million, but whether that will come in a lump sum or an annual dole has yet to be haggled over. Last week the senior royals--the Queen and Prince Charles--attended the memorial ceremony for the Gulf War dead. The regal phalanx was secondary news as papers devoted pages to Diana's latest crisis. That sort of snub inspires the kind of resentment that dies hard among people who expect celebrity treatment even though they would choke on the word.

    This is a game that will not end with a divorce settlement. For years, indeed for decades, Diana will be a presence in the Windsors' life, and the contest between royalty and celebrity will go on and on. Charles will enjoy the status conferred by a role embedded in his country's traditions. One day he will occupy the ancient English throne, he will open Parliament, the coins and bills will bear his portrait. Diana, in contrast, will have no formal place in England's order, unless she forces the palace to give her one. She has said she would like to become a goodwill ambassador, not an official one, and the issue of her future position is central to the divorce negotiations. Whatever role she is assigned, however, Diana will never have the weight of the Establishment behind her. Her real strength will continue to derive from the adoration of both the people and the cameras. So far, that has proved an equal match to 1,000 years of history.