You are of course 100% correct but, as I have explained in an earlier response, the people you are arguing with (who are well-meaning) simply will not listen to you. They know that 'Adam was created as perfect as G-d Himself, and that G-d can't handle imperfection of any kind without damning it. When Adam sinned, he thus damned all future generations of mankind for imperfection. It doesn't matter that everyone is different and some people are more sinful than others and some are less sinful than others. G-d cannot individually reward/punish sins and good deeds because He can't handle the imperfection Adam's sin introduced into humanity. Sin is essentially a disease, individual sins are merely the symptoms. Mother Teresa and Joseph Stalin both deserve the identical same eternal damnation because they both had the same disease--the fact that one had more symptoms than another means nothing.
Because they begin their reading of the TaNa"KH with a "new testament" perspective they interpret the entire Torah as a combination stop-gap and prophecy of the coming "messiah" who was vicariously damned in the place of every single human being who would ever live, thus allowing G-d to maintain His Holiness (which demanded eternal damnation for the imperfection introduced by sin) while showing mercy to his creatures.
It is important to remember that this view represents only Fundamentalist Protestantism, not Roman Catholicism or Eastern Orthodoxy. To a Fundamentalist Protestant, both Catholicism and Orthodoxy are barren legal systems of no merit or use (they merely replace HaShem with (lehavdil!) J*sus as the object of their prayers for mercy). This means that Fundamentalist Protestantism cannot be genuine chr*stianity because it has no roots or connections to the ancient chr*stian past. It also means that Catholicism and Eastern Orthodoxy are hypocritical because they basically take the same attitude as Judaism, except they replace the Holy Torah with a "new law" and HaShem with (lehavdil!) J*sus.
Some people who argue with Protestants make the great mistake of sounding as if they are promoting the idea that man is not sinful, or that there is nothing wrong with us. The good Protestant, obviously, knows that there is very much wrong with him, and thus is confirmed even more in his erroneous beliefs. It is not that there isn't anything wrong with us (Adam's sin marred the entire creation, not merely human nature), but this does not mean that G-d can only react to this by damning someone (either the victim or the scapegoat). Nothing G-d created shares His Holiness or perfection. Indeed, each year on Ro'sh HaShanah G-d judges all created things, including even the Heavenly bodies, because they are not perfect, but this doesn't mean they have to be condemned to eternal damnation. Before man had even been created the earth already sinned by disobeying G-d and bringing forth "`etz `oseh peri instead of `etz peri `oseh peri (where was Satan while this was going on?), yet while it was punished, that doesn't mean the earth had to be eternally damned! Fundamentalist Protestants also don't seem to understand that evil, rather than the creation of a fallen and rebellious angel, was mysteriously a part of G-d's plan all along (He created both Satan and the evil inclination).
In order to break out of this mentality the chr*stian must read the TaNa"KH without any chr*stian preconceptions, which for some people is very hard. So by all means continue to defend the Torah, but please also understand why it is so difficult for them to understand.
I once believed exactly as they do, and probably were it not for my own unique experiences I'd still believe it.
I don't think you can put "fundamentalist Protestants" all in the same boat. There are two main divisions of theology in classical (non-Lutheran) American Protestantism, Covenant Theology, and Dispensationalist Theology.
Both systems rely on free grace given by God, through the life, work, death and resurrection of Jesus the Messiah, however, Covenant theology draws closer parallels with ancient Judaism--saying God's people have always been saved by grace, from Adam, to the present day. Law keeping and good deeds are understood as the result, not the grounds, of forgiveness.
It seems entirely logical that pharisaic rabbinic Judaism (the branch from which modern Judaism came) would, since it has not had sacrifices for 2000 years, very much de-emphasize their place in Jewish religious practice. After all, since the Temple system is gone, the focus must be on other aspects of Judaism--namely the law of God.
However, until the exile into Babylon, EVERY generation of Jews, going back to Abraham...or really Noah and before...had blood sacrifices as central to their religion.
Given the Levitical regulations, and the centrality of the Temple, with its enormous altar (used many times a day for offering blood sacrifices), it seems nonsensical to argue that blood sacrifice had nothing at all to do with the forgiveness of sins in ancient Judaism. Also the yearly Day of Atonement--when sacrifices were made on behalf of the entire nation, and also the one day of the year when the High Priest could enter the Holiest Place before the Ark in the center of the Temple--would definitely seem to indicate that blood atonement is central to ancient Jewish belief.
The New Testament argues too that blood sacrifice in and of itself, did not affect forgiveness of sin. God in His mercy did that.... However, the argument then follows that the whole sacrificial system pointed ahead to a better way which actually did fully cleanse from all sin, that in the person and work of Jesus.
As to why these divergent views, Christian ignorance and intransigence? I would suggest an alternative explanation:
Christianity, with its centrality of an idea of atonement for sin (in the self-sacrifice of the Messiah), follows in the way of one branch of ancient Judaism.
Modern Judaism, with its emphasis of law-keeping and good works as the basis of salvation, follows another branch of ancient Judaism.
Covenantal Protestantism also regards as nonsense your description of: "G-d cannot individually reward/punish sins and good deeds because He can't handle the imperfection Adam's sin introduced into humanity. Sin is essentially a disease, individual sins are merely the symptoms. Mother Teresa and Joseph Stalin both deserve the identical same eternal damnation because they both had the same disease..."
Every sin demands separation from God, however, greater sinners, like the monsters Stalin or Hitler, deserve greater punishment. Individual sins and good deeds are definitely punished and/or rewarded. Jesus taught that, and so does biblical Christianity. Since God came and lived here in the person of Jesus Christ too, of course He can "handle imperfection." It's those who sin though, who cannot handle God's holiness. On what basis, or foundation, though, can anyone who sins (which is everyone) stand before a holy God?
Mother Theresa doesn't "deserve" Hell. Why? Because she trusted and loved God, and His way of salvation. Mother Theresa's loving life and attitude though, came FROM her trust in Jesus' love, and Jesus Himself in His mercy, not her good deeds, is the reason she will be in Heaven.
Yes, Christians read the Tanak in light of the New Testament--the great majority of books in it, by the way, composed by Jews. If Messiah has really come, then it would be a sin to try to understand the Tanak in any other way.
Since Christians do indeed however read and study the Old Testament, before trying to discuss Judaism, it would only seem logical and fair that before Jews try to critique Christianity, they read and study the New Testament.