Nick was the turkey. He thought he was working for these guys, just like dad. He was OK until the feds started snooping around. Sooner or later he would have led the FBI to some bad guys.
This 26 year old had just too many coincidental contacts with too many people in Oklahoma City, people conneted with 911, and people connected with AQs in Iraq. He was dangerous to AQ.
I can believe it. He was wandering around Iraq with electronic equipment and probably electronics repair equipment when he was picked up. When he revealed that he had been questioned by Iraqi police and the FBI had been snooping around, Al Queda decide that he had become a liability and decided to make his execution dual purpose.
During the third scene I doubt that he is drugged as he sits up on his own throughout the tedious propaganda speech and shifts around several time to try to relieve some physical discomfort he is experiencing. His head is erect and he appears alert. I don't think he was expecting what came next.
IMHO, the actual murder was botched as they zoomed in too much and were out of focus so they decided to do it again, this time with a beheading.