It is a very tough essay to parse and frankly I don't understand it very well.
After looking at it I can tell that it is working towards a very complex idea about the relationship between the masses, technology, governments, patterns of action and perception (habits), and war. Something about how the development of technology has made it necessary that property rights be redistributed, that some sort of Marxist proletarian revolution need happen. But that in order to prevent the redistribution of wealth the government has turned to war, given the people a way of expressing themselves through war, and not through revolution. But what is properly aesthetic about this?
Benjamin says that aesthetics, for the Greeks, was the study of perception. So the aestheticization of politics has something to do with the crafting of perception. He claims that the rise of technology has profoundly reshaped people's cognitive-sensory apparatuses, that we are now perceiving the world in new ways. And it seems aestheticization of politics would mean that the government is crafting people's cognitive-sensory apparatuses to make us go to war instead of revolting.
Which still means that, under Collingwood's definition, this does not qualify as a proper aestheticization of politics. Rather, it means government has become a form of craft, it has become involved in the business of representation.
I badly need to reread 'The Work Of Art In The Age Of Its Technological Reproducibility." That is the only way I can intelligently write this conclusion.
Perhaps I'll do that RIGHT NOW.