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I will return with thoughts on adjusting Max's assigned probabilities, but prefer to start with two more 'qualitative' arguments. First, I am not persuaded by statements and events to date that Russia is experiencing severe setbacks in the last 1-2 weeks. I noted a Ukrainian boast - hard to credit it with a milder term - that it has recovered 900 square kilometers of Russian-annexed territory. If true, that amounts to roughly 18 by 18 miles, a rather insignificant amount of steppe. Eventual negotiations can be expected to haggle over much larger chunks of territory, and in the half-forgotten lexicon of European great power competition, such adjustments do not throw possible outcomes into either the 'Vietnam' or the 'Kosovo' bin - more like Alsace-Lorraine.
Second, it is very important to look closely at the actual correlation of forces. Even before it crossed into Ukraine, Russian military capability was inferior to NATO's, and Russia's GDP and demographics promise no chance of significantly altering that imbalance. The only exceptions are in the near parity of nuclear forces, and in minor advantages in the numbers of certain conventional ground combat systems such as field artillery that do not translate into significant offensive military power. Russia does not dare (and has not, since February 2022, dared) to provoke direct war with NATO. Hence, by the way, their very real concern since the mid-90s with NATO eastern expansion.
In that context, Putin's recent references to nuclear weapons are simply restatements of Russia's national strategic doctrine since before he came to power in 1999 - and both represent weakness, not power. Russia can, quite demonstrably, barely prosecute one regional war against a third-rate contiguous neighbor. The prospect of direct NATO intervention - a prospect heightened logically not by Ukrainian success but by Ukrainian weakness and exhaustion well-concealed by Western media and leaders - is very frightening to Putin. Hence what I call the 'Blazing Saddles' ploy of holding a gun to his own head. Putin cannot fight NATO conventionally, and cannot prevail in a nuclear war either. He can only hope to engender the response that Cleavon Little got in the movie: "Don't move, men - he might be crazy enough to do it!" Hence, I reject the notion that Putin would see any advantage in any form of nuclear weapons use in Ukraine. As another commenter noted, talk is cheap. Putin's "threats" are no worse than those of Biden and other senior NATO leaders and spokesmen.
The unspoken rule since 1949 has been that nuclear powers do not engage in direct combat with one another, proxy wars, insurgency/counterinsugency, bluffs and bluster notwithstanding. That rule is an important firebreak holding nuclear war at bay, needs to be maintained, and in my estimation will be.
The outcome I consider most likely - unless the US and NATO continue to prevent it - is a negotiated solution that will involve considerable compromise on both sides.