Updated

Several hundred Egyptians marched toward the presidential palace in Cairo Sunday to protest the president's decision to keep the referendum on a disputed draft constitution scheduled for next week.

The protests were noticeably smaller than other rallies over the past week, possibly reflecting the opposition's bind in the face of the partial concession by President Mohammed Morsi, who agreed to annul his Nov. 22 decrees that gave him near unrestricted powers and immunity from judicial oversight.

Despite scrapping the earlier decree, Morsi stuck to the Dec. 15 referendum on a constitution hurriedly adopted by his Islamist allies during an all-night session late last month.

"This has confused many, who opted to stay home," said Tarek Shalaby, a protester and member of the leftist Revolutionary Socialist group, as he marched toward the palace. "But we should continue our pressure. We can't lose our momentum."

Shalaby said he has still not decided whether he will vote no or boycott the referendum.

Egypt's opposition says it will keep up protests against the referendum but stopped short of advocating either a boycott or a "no" less than a week before voting.

The opposition was still pushing Sunday for Morsi to cancel the referendum, saying they reject the process entirely.

The National Salvation Front, an umbrella opposition group of liberal and leftist parties, warned that holding the referendum in such atmosphere will lead to more strife. It called for another massive rally on Tuesday.

The opposition said Morsi's rescinding of his decrees was an empty gesture because the decrees had already achieved their main aim of ensuring the adoption of the draft constitution. The edicts had barred the courts from dissolving the Constituent Assembly that passed the charter and further neutered the judiciary by making Morsi immune from its oversight.

Still, the lifting of the decrees could persuade many judges to drop their two-week strike to protest what their leaders called Morsi's assault on the judiciary. An end to their strike means they would oversee the referendum as is customary in Egypt.

In his late night announcement, Morsi replaced the scrapped decrees with a new one that doesn't give him unrestricted powers, but allows him to give voters an option if they decide to vote "no" on the disputed draft charter.

In the new decree, if the constitution is rejected, Morsi would call for new elections to select 100-member panel to write a new charter within three months. The new panel would then have up to six months to complete its task, and the president calls for a new referendum with a month.

The process adds about 10 more months to Egypt's raucous transition, but could answer some of the opposition demands of a more representative panel to write the charter, if the elections are not swept by Islamists.

If the referendum goes ahead, the opposition faces a new challenge -- either to campaign for a "no" vote or to boycott the process altogether. A low turnout or the charter passing by a small margin of victory would cast doubts on the constitution's legitimacy.

It was the decrees that initially sparked the wave of protests against Morsi that has brought tens of thousands into the streets in past weeks. But the rushed passage of the constitution further inflamed those who claim Morsi and his Islamist allies, including the Muslim Brotherhood, are monopolizing power in Egypt and trying to force their agenda.

The draft charter was adopted amid a boycott by liberal and Christian members of the Constituent Assembly. The document would open the door to Egypt's most extensive implementation of Islamic law or Shariah, enshrining a say for Muslim clerics in legislation, making civil rights subordinate to Shariah and broadly allowing the state to protect "ethics and morals." It fails to outlaw gender discrimination and mainly refers to women in relation to home and family.

Sunday's rallies were the latest of a series by opponents and supporters of Morsi, who hails from the Muslim Brotherhood.

Both sides have drawn tens of thousands of people into the streets, sparking bouts of street battles that have left at least six people dead and hundreds wounded. Several offices of the Muslim Brotherhood also have been ransacked or torched in the unrest.

Morsi, who took office in June as Egypt's first freely elected president, rescinded the Nov. 22 decrees at the recommendation Saturday of a panel of 54 politicians and clerics who took part in a "national dialogue" the president called for to resolve the crisis. Most of the 54 were Islamists who support the president, since the opposition boycotted the dialogue.

Bassem Sabry, a writer and activist, called the partial concession a "stunt" that would embarrass the opposition by making it look like Morsi was willing to compromise but not solve the problem.

"In the end, Morsi got everything he wanted," he said, pointing out the referendum would be held without the consensus Morsi had promised to seek and without giving people sufficient time to study the document.

The assembly that adopted the draft constitution was created by parliament, which was dominated by the Brotherhood and other Islamists, and had an Islamist majority from the start. The lawmaking lower house of parliament was later disbanded by court order before Morsi's inauguration.

If the draft is approved in the referendum, elections would be held for a new lower house of parliament would be held within two months, Morsi decided.

The deepening political rift in Egypt had triggered a warning Saturday from the military of "disastrous consequences" if the constitutional crisis isn't resolved through dialogue.

"Anything other than (dialogue) will force us into a dark tunnel with disastrous consequences, something which we won't allow," the military said in a statement broadcast on state TV and attributed to an unnamed military official.

It was the first political statement by the military since the newly elected Morsi sidelined it from political life soon after he was sworn in.

With the specter of more fighting among Egyptians looming, the military sealed off the presidential palace plaza with tanks and barbed wire -- and on Saturday set up a wall of cement blocks around the palace.

Both sides have accused the other of turning the political battle into a violent street clash that could spiral out of control.

Leaders of the Muslim Brotherhood have spoken of a "conspiracy" hatched by figures of the ousted regime of Hosni Mubarak aimed at ousting Morsi.

Meanwhile, the opposition accused gangs organized by the Brotherhood and other Islamists of attacking its protesters, calling on Morsi to disband them and open an investigation into the bloodshed.

Members of a so-called Alliance of Islamists forces warned it will take all measures to protect "legitimacy" and the president -- comments that signal further violence may lie ahead.