NO one is heading for the Oct. 30 Middle East peace talks in Madrid with exaggerated hopes for success. The parties bring with them 40 years of accumulated suspicions. While the Gulf war and the end of the cold war have reshuffled political assumptions in the region, there's been no attitude-shattering event like Anwar Sadat's trip to Israel to change the political mood in these countries.Participation in the coming conference is impelled more by concerns about relations with the United States than by the promise of better relations with each other. The Arabs - Syria, Jordan, the Palestinians, and Lebanon - want the US to lean on Israel to relinquish the lands taken in the 1967 war. Some hope, unrealistically, that the Bush administration's avowal of "land for peace" means full return of all territories. More likely it means this formula will serve as one basis for compromise. Israel embarks for Madrid under the threat of continued pressures to alter policies seen in Washington as obstructions to peace - notably its fast-paced settlement program. Last month's controversy over US loan guarantees shook Israeli-American relations. Many in Israel's government want no part of the talks, but they want even less to damage ties with Washington further. With elements of Prime Minister Yitzhak Shamir's ruling coalition ready to bolt, Israeli politics will bear watching in the countdown to Madrid and thereafter. So will Palestinian politics. The PLO is maneuvering to gain public recognition of its backstage, but very real role in the talks. If that effort is carried too far, Israel could decide its ground rules have been broken and opt out. Israeli public opinion, however, largely favors the talks, despite deep skepticism of Arab motives and of the wisdom of returning land. The immediate task of the American and Soviet sponsors of the conference will be to ensure that it gets beyond the opening days, which will probably feature forceful presentations of diametrically opposed views. Washington has no announced game plan for the talks, only a three-phase structure leading to direct negotiations between Israel and its various Arab neighbors. If the talks proceed to Phase 2, however, and deadlock occurs, Secretary of State James Baker and his team will be ready to offer long-th ought-out compromises. The US has felt all along that the key is to get the parties around the table. Once that is done, and the world's attention centers on Madrid, it will be difficult for either side to walk out. The process of discussion and compromise will at least have a chance to begin.