I assume they would probably still _attempt_ to limit the amount of total liquid. But the idea that terrorists can bypass a chemical bomb detector but not figure out a way around the amount of liquid limit is laughable.
As for the "split into smaller bottles", I think that's a brainfart on the part of the agent, at least around here you're limited to a couple 100ml containers.
See? All TSA achieved is horse shit. You can still end up on the other side, with a litre bottle of whatever substance you wanted to have,and they couldn't stop you. This is why this entire agency is absolutely useless and more an inconvenience than anything.
Of course, blowing up a plane is sort of a stupid notion anyway. If I wanted a terrorist attack, I'd just bomb a building directly, Oklahoma City style. That wouldn't even need to be a suicide attack. If I was dead set on a suicide attack on an airline, I'd just pick the longest security checkpoint line and blow myself up there.
There are plenty of tactical reasons for commandeering an airplane, but blowing it up is generally not one of them.