By encouraging people to follow the laws of God written on their hearts, they become closer to the One True God. Interfaith dialogue as discussed by the Church won't result in an Islamic Mullah becoming a Christian. The Church recognizes correctly that these other established religions are just as important to their followers. By promoting fellowship among all peoples, they are drawn closer to our God. The idea is to bear fruit down the road, not today.
So I agree with you, and I agree with Cardinal Arinze...
Would Imams even bother sitting down with Arinze if he came at them like a Jehovah's Witness?
I believe that God works in ways we cannot begin to fathom. Who's to say (though there will be many, complete with chapter and verse) that when all is said and done, at the moment of death, Jesus calls us to sit beside him. We are in ecstasy, and realize that those around us are of many faiths (I know, you can't tell in the robes we'll be wearing, maybe there are nametags).
What if God has revealed Jesus to them within their own doctrines and, they have the opportunity to accept him in their hearts at death as I hope we Christians will?