You are right.
There are some 2 Billion Muslims. We can't kill them all -- well, we could, but it would get to be a problem.
Bush is doing the smart thing: go after the militant Muslims, who want to kill everyone who isn't a Muslim, which is maybe 5-10% of the total Muslims, and work on the rest, to transform their religion to a more peaceful one, without actually saying that.
http://islamicweb.com/begin/results.htm