You've got an American paradigm. Think of it this way. Kindergarten class. Boys hate the girls and vice versa. They all vote themselves free ice cream and all day recess, but they still don't like each other. Democracy.
What Bush's vision screws up is the focus on democracy -instead- of rightly focusing on "individual liberty" and freedom. THOSE -are- indeed incompatible with Islam.
Democracy per se works fine with Islam-- One Man. One vote. One time.