OK, follow-up on the dialogue that Abiola & I have been having. On many points of fact, we don't disagree. For instance, I suspect we would agree on the following:

1) The early period of Judaism was characterized by a tribalistic faith, henotheism, rather than monotheism.
2) These West Semitic peoples were likely a coalition of tribes, with latecomers (for instance, the tribe of Dan), and not characterized by racial or ethnic awareness as much as cultural differences (Solomon married pagan women-but it was their heathenry rather than their ethnicity that was problem, see Ruth as a contrast).
3) Between 500 BCE and 500 CE a lot of varieties of "Jews" existed. It is possible that at one point 1 out of 10 inhabitants of the Roman Empire were Jewish, probably through conversion. The conversion of non-Jewish kings to Judaism was common-place in the "market-place" of religions, the family of Herod being a famous example, but others include the Jewish kings of Yemen.
4) Judaism existed as various affinal movements that are well known to us today (Pharisees, Sadducees and Essenes for instance). Others are less well known, for instance, the Hellenistic Jews and the "God Fearers."
5) During this period, the "ethnic" identity of Jews was more cultural, and through the process of conversion, which entailed circumcision for men, one could become a part of the Jewish people. The Emperor Domitian made proselytization a capital crime for Jews likely because his own family members had converted (his older brother, the Emperor Titus, had a Jewish mistress).
6) The rise of the "daughter faiths," Islam and Christianity, changed the Jewish religion and culture greatly. While the more "liberal" and "integrationist" forms of Judaism melted away (it is likely that Hellenistic Jews and "God Fearers" were prime candidates for Christian conversion), Rabbinical Judaism, now known as Orthodox Judaism, remained as the primary minority religion within Christendom & the Dar-al-Islam.
7) The various cultures that Judaism was formed under has had a big impact on transforming the tribal henotheism of the 8th century BCE into the tribal ethical montheism of the 8th century CE. The influence of Zoroastrianism is famous, while practices like matrilineal descent were probably picked up from Romans. It seems that the ideas of the afterlife that Jews like Maimonides espoused were influenced by the Greek, Christian and Muslim traditions.
8) At various points, Jewish groups became sharply reduced in number through forced conversion, and the injunction by the majority communities to not proselytize became part of custom & tradition, and a very important one for group survival. This resulted in the isolation of Jewish groups genetically from the surrounding population. For example, it seems that the Jewish Yemenite population does not have much black African mtDNA, and this might be the result of the fact that by the time of the major importation of slaves began during the high Islamic period, they had already been sealed off by marriage from the surrounding society (Jews might leave through converison, but no one entered the faith).
9) Between 1000 and the modern era, the vast majority of the world's Jewry existed in communities where a relationship with a dominant religious ethos was important, whether that be Roman Catholic, Eastern Orthodox, Muslim or establishment Protestant.

At this point, I will go on to make a few assertions that are more tenditious. Read more below....

Here is the ADL's ire at Southern Baptist attempts to convert them:

The campaign launched by Southern Baptists to convert Jews to Christianity is an insult to the Jewish people and a setback for the cause of interfaith dialogue and understanding. We are very sad that emphasis would be placed on converting Jews rather than promoting a common ground and discourse between all faiths.

The ADL is a caricature of the modern American Jewry, but that allows us to examine in more detail the gross features of the American Jew and their outlook toward the world. I bolded a few points, note the constant switch between the conception of Jews as people (ethnos?) and a religion. Substitue "people" with "religion" and I think it seems a far less injurious "insult" for most Americans, after all, it is accepted that in our market-place of faiths individuals can convert from one religion to another. The ADL seems to be saying that to convert a Jew from one religion to another is somehow an insult that person's ethnicity (ethnicide?)! Additionally, try and map this to the Christian context, it is simply strange to speak of the "Southern Baptist people." It is interesting to note that traditionally Jews of no religion have been far more accepted as "Jews" than Jews of another religion (see here, page 20 of the PDF). It is a banal observation to say that Jews are both a people and a religion.

I believe this situation is somewhat problematic for Americans to understand. This is a culture where switching religions is common-place, where churches compete for followers, and individualistic tailored spirituality is the norm. The Jewish conception of an organic whole of religious peoplehood seems archaic, and it should, because I believe it was formed in a very different context, that context being pre-modern Europe and the Middle East.

Prior to the Protestant Reformation, and the eventually dominance of the conception that religion was a personal choice, Europe was nominally under the Universal Catholic Church. There was a schism between the eastern Church and the western Church, but within their own spheres, the two behaved in similar ways and evinced the attitude that they were the One True Church. Before the conversion of Constantine, Christians were a self-selected minority, strong in their faith. After the barbarian invasions, the model of Christianization became different, as elites were converted, while the masses were nominally baptized, but de facto pagan. Each priest has his "flock," but the flock was simply an administrative division in the Universal Catholic Church-which was a monopoly elite faith. Until the Protestant Reformation it might be asserted that much of Europe was pagan on the ground. A historical survey of the early medieval period shows that bishops and notables were aware of the explicit paganism practiced by their serfs, but salvation was attained by a people, not through individual faith, so only the very devout would attempt to instruct their dependents on the One True Religion.

In this context, the idea of a Jewish people and faith makes sense. The Catholic Church had an ambivelant relationship to the Jews, as did the Muslims. Both groups agreed that the Jews had some relationship to God, but they asserted that their's was the true faith. Though the Catholic Church was implicated in some attempts to convert the Jews to Christianity, in general it tended to grudgingly support the Jewish wish to continue existence as a separate religion and people (in fact, there is evidence that anti-Jewish pogroms were most effective where church and state power were fractured and weak, for instance, the Rhineland). The Church and the State had a relationship with the local Jewry as corporate entities.

Move forward to the 21st century, the United States. The Church is fractured, and resembles more the jostling of businesses attempting to win clients, while individual choice is paramount in both economics and politics. The Jewish leaders can no longer negotiate with centralized powers, but rather have to face a host of various actors, from liberal denominations willing to respect them, to evangelical ones who wish to convert them. While the Universal Catholic Church prior to the Reformation tended to de facto accept the concept of salvation of a people, so that the paganism of most of their rural flock was no great worry, Justification by Faith Alone and the religious individualism sparked by the Reformation, and its Counter-Reformation, made Christianity much more concerned about everyone's individual beliefs (as was the case during the pre-Christian Roman period when society was damned in any case). The United States is the end point of this revolution.

Modern American Judaism has adapted to some extent, offering various avenues of religious expression, from Reconstructionism to Hasidism (with Reform, Conservative and Modern Orthodox in between). This is in sharp contrast with most of the rest of the developed world, where the choice tends to be between Orthodox and Secular (with a "Liberal" rump here and there). In countries where religious feeling is low (such as northern Europe), or de facto religious monopolies are in effect (Catholic southern Europe), the old Jewish ways of religion & people work. Similarly, they work in Israel as well, where there is little viable competition. But in the United States, they simply can not keep up with more aggressive religious firms.

The fact is that American Judaism must become just another denomination. Certain business practices, including proselytism, that were not appropriate (or possible) in a world of guilds, Church and nobility, must be revived for the American Age. The Jewish establishment, which is already fractured in comparison to the past, can not negotiate a modus vivendi with 1,000 religious denominations. The cartel mindset must go!

But can it? I am skeptical, both from reading, and my experiences with secular Jews. Of course, there are those disagree with me, but in the end, I don't care really if the Jewish faith comes or goes.

Sources for some of the historical assertions:
Europe: Was It Ever Really Christian?
Before France and Germany: The Creation and Transformation of the Merovingian World
One True God : Historical Consequences of Monotheism
The Germanization of Early Medieval Christianity: A Sociohistorical Approach to Religious Transformation
PAGANS & CHRISTIANS