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Did Invading Iraq Scare Iran?

The excellent Steve Coll has an extremely confusing and unsatisfying Comment in this week's New Yorker. Here's Coll:

Iran’s ruling clerics are revealed in the estimate as nervous types. As the mullahs watched the United States recklessly invade Iraq, in 2003, to destroy weapons of mass destruction that no longer existed, they harbored the guilty secret that their atomic-bomb program did exist, and might yet be discovered. So they apparently put their bomb work to rest.

This seems reasonable except for one tiny detail: The idea that the Iranian leadership saw what happened to Iraq and, a la Libya, stopped enrichment makes little sense because no one knew they had stopped until four years later! It doesn't do them any good to halt the program if no one knows about it. In short, it's just the same as not stopping. Libya was scared, apparently (although I guess there were other reasons), and went to Britain and America and declared it was giving up its nuke program. Iran's course of action left them just as likely to get invaded or bombed. Hell, it's possible that if it weren't for some defectors, we still would not know that they had stopped.

Coll goes on to say:

In only one instance, Saddam Hussein’s Iraq, has pre