Russia is giving IDs and clearing people of debt. Version that this will be some kind of semi-independent region now doesn’t hold up because of IDs, also Russia seems to really going to win this one also because of going through the process of giving IDs.
I don’t believe this was the plan, but since the “first phase” failed, Russia has no other option other than annexing as much of Ukraine as possible.
Not to mention, the financially crippled and weakened western ukraine that’s left behind will probably become a sink of money for EU/US aid, further putting strain on an already economically weakening Europe.