He's not all-powerful, but there's also this myth abroad that Obama has this really liberal agenda, but is hamstrung by the Republicans and the right of his party, the "Blue Dogs". In fact, his actions suggest that politically there's no space between him and the Blue Dogs.
This is shown not only by the centrism/right-of-centrism of most of his policies - Afghanistan escalation, massive corporate giveaways in the bailout, cap-and-trade bill and healthcare bill, marriage equality, protecting government employees suspected of torture, denial of due process to suspected terrorists etc. - but by the manner of the way he uses the power he
does have to influence the Congress. Witness how Rahm Emanuel apparently
bullies freshman Democrats who advocate a liberal line on war escalation, while
protecting Blue Dogs who are obstructing what Obama had claimed was his goal - a robust public option in health insurance.