"Don't try to frighten us with your sorceris ways, Lord Vader" - what was the point?

Yeah, well Ozwald, schmoz-wald...., he's still the Admiral whom Vader whacks.

He's feared and respected from the moment he becomes Palpatine's apprentice. Nobody knows who the hell Luke is, other than the fact that he blew up the Death Star, which is a feat any jabrone could have accomplished...., in the Empire's eyes. Its not until the middle of ESB that the Emperor tells Vader that Luke is a threat to them.

Obi Wan is toast, so why is he even an issue for the Empire? Answer: He's NOT.

As for tracking down Luke, this is Vader's own personal agenda, not part of the Empire's plan. Read the opening scroll.

Vader is feared and respected because he's #2 behind the Emperor. The fact that he's encased in Black Armor and breathes with an iron lung and can kill someone who crosses him or disagrees with him is just an added incentive to fear him.

 

I agree with alot of what everyone's been saying. I would reccomend reading this thread for more discussion on Vader and Tarkin's relationship:

http://boards.theforce.net/Classic_Trilogy/b10002/20145379/p1

I think the point of this line is to show lots of things. As has been said previously, it communicates the idea that the general populace's respect/knowledge of force, and its user's abilities has probably slipped into decline by the time of ANH.
Also it shows the little rivalry between the military beauracracy and Vader by this time. Vader and the military are completely subservient to the emperor so there is a little competition here as to who can serve the Emperor best. Motti is the biggest fan of the Death Star and believes this is the future of the Empire, this is what is going to keep the galaxy under the Emperor's thumb, not some washed up ex-jedi knight. He is a little drunk by the success of the Death Star and just cannot resist rubbing Vader's nose in the fact that he is obsolete as far as the empire is concerned. "Look what we've accomplished here, a machine that let the Emperor dissolve the Senate and will ensure his rule of galaxy, and you can't even find the rebellion or capture the stolen plans, what good are you or your abilities?" is basically whats under the surface in this exchange.

 

DARTH-SHREDDER posted: George Lucas needs to go to Hell!

That's blasphemy

 

I've been wondering how Palpidious pulled that off, I mean the public disregard of the Force as a superstitious concept (see, apart from the Imperials, also Han's ignorance of the Force). Either the Force and the Jedi have never been very well-known and respected throughout the republic, even in the days before the empire, or he managed to pull off some kind of "cultural revolution", rewriting history and controlling education in order to render the Force and the Jedi a laughable relict of the past. Otherwise I can't see how people forget about the Jedi and their use of the Force within two decades.

 

Perhaps the fact that they had been defeated/wiped out led people to wonder if they were really all they were cracked up to be in the first place. People who are upset at being oppressed by the empire may resent the Jedi's failure to protect them and feel betrayed or foolish for having believed in them. The ideas you raised sound good too.