Update: The plot is alleged to have been hatched by young Muslim-German men who had been attending the same mosque in Hamburg where the 9/11 hijackers attended. Some of them went to northwest Pakistan for training, and one of them was captured in Afghanistan in July.
A Mumbai-style attack is inexpensive and logistically unchallenging. If the attackers are willing to die, they can shoot up hotels and malls and set off some bombs. Doing several cities at once would spread panic and is an al-Qaeda MO. The whole thing seems perfectly plausible to me, and while I understand the GWOT fatigue among analysts and commentators, I don’t think it can be dismissed.
It can be said that such operations are hard to forestall and that also they are a comedown for al-Qaeda, since they don’t accomplish anything at all. You will note that Mumbai is doing just fine and PM Manmohan Singh declined to take the bait and go to war with Pakistan, as the Lashkar-i Tayyiba had hoped.
The point of 9/11 for Bin Laden was to drag the US into Middle Eastern quagmires. Not everyone is as gullible as George W. Bush and fringe terrorist groups should be dealt with quietly and effectively, not with big multi-trillion dollar wars.