They send aid and comfort to Arab terrorists fighting Israel. In fact some months ago, the PA "Finance Minister" visited Libya and got some money from Qaddafi. Qaddafi's regime is a fundamentalist regime, using Islamism and Marxism through his "Green Book." In addition, the Libyan governments glorifies terrorism in its state media. Removing sanctions from Libya and letting it enter the international arena is a big mistake. Qaddafi is doing everything Arafat did to get back into business.
Again, not necessarily. Libya has been making efforts in recent years to burnish up their image. Although the jury is still out on the issue, it is still very interesting indeed.