All the 'secular' Arab regimes are old-fashioned Gramscian fascists, particularly the Baath party and all its ugly little terrorist off-shoots. I hate to sound pessimistic, but I don't see how any democratic-republic will work in that part of the world. We could help the Iraqis build a system similiar to ours and within 5 years it will be destroyed by tribal and religious infighting and shoot-outs over arguments about which caliph did what, when.
I think you are exactly right. Witness how Russia, which is much more close to Europe culturally, struggles with democracy for centuries. Until the last decade, it existed there for a few months --- from FEbruary to October of 1917 --- in all of its history. The values placed on individuality vs. community, on the rule of law, etc., are very different in that part of the world. These values endure and outlive even industrial revolutions.
For that reason, I too do not entertain much hope. But if we cannot make much progress it does not mean we cannot make some progress, which we definitely see in the case of Russia, for instance. My main concern is to have there a govenment that is not malevolent to us.