Ethnic nationalism is an out-date concept, fit for the 19th and 20th centuries (This, I believe, is the what Fox was trying to get at), although its orgins come from the ancient tribal mential of humanity.
People tend to devide the world in to two groups: us and them. And if they are weak, they demand that the group 'us' be protected and insulated from the outsiders (them). That sound fine and mighty, until the group gain power; then they start demanding that other groups conforming to their way of life. This mentality can lead to only one thing; perpetual conflict and war. People have argued that religion lead to wars of 'our god is better that your god', and while somewhat true, it is only a part of a large problem. It is really more like 'our god/language/enthnicty/culture is better that your god/language/enthnicty/culture'.
Deviding up nations up so that every ethnic group has it on state is insane. It would diminish the very existance of the state, as it could not properly defend the state, nor enforce law and order if it is constantly be underminded by successionist movements. Such nations would only serve to hamper the flow of goods, services, capital, people and information accross the world, all in the name of "national (or cultural) survivial". Organizations like the PQ/BQ, Scottish Independence Party, Eusko Alkartasuna, are living in a dream world. The time for nations has past, and we ought move beyond it.