Hisway-
You are right in most of what you say and I agree with you. But if baptism was necessary, there would be no way the gentiles could have recieved the spirit and then be baptised. If it were a necessary requirement, then they would have needed to be baptised first and then they would have recieved the Holy Ghost.
I agree that water baptism is a NT sign of circumcision, I wish you would have taken it a step deeper though. What you didn't say the first time was the "repentance," which changes everything in your argument. One must understand the connection as you pointed out b/w the two, before that argument is valid. Sorry for not being more confident of you.
Now, baptism is a work indeed. What do I mean by this? Is it works that save? Not at all, but it was faith that produced the work, for faith without works is dead.
Baptism is important, it is a sign of repentance, but let's not focus more on the ritual then the spiritual. As you have stated, baptism is an act of repentance. So the question is, do you think that if someone repents and crucifies the flesh, since they did not do the ritual of baptism, it is of no effect?
Like Pual says, circumcision is not that of the flesh but of the heart. So is baptism not that of the ritual but the spiritual. You said, baptism is a type of death/being buried. So is it more important to be baptised (the physical act) or bury the flesh (the spiritual journey).
The man on the cross with Christ had no chance to be baptised yet he was saved by his repentance from his former deeds. So baptism seems only necessary if you have the chance. The more important thing is to do what it represents. Just as the more important thing is to be of a circumcised heart than penis.