Yes. I read it and I came to the same conclusions you did.
"Oh," say my liberal co-academics, "no Islamic authority believes in a literalist interpretation of the Koran!"
("Have you ever read it?" I ask. "Well, no, but no Islamic authority believes...")
But as my significant other says, religion isn't defined by the scholars, it's defined by the people who read the text and then strap a bomb to their chest and walk into an Israeli pizza parlor.
There are American Christians, including Falwell and Robertson, who claim that the attack was due to God's "lifting his protection" from the U.S. because we were not "Christian" (ie., "holy") enough. How "Christian" is Christian?" 50% of the people devout? 75% devout?
I agree with the person who says that the Islamic scholars say "no one takes the Koran literally anymore." That statement is possibly true---in the circles these scholars travel. (How many "devout religious" academics do you know? I know few, and I teach at a Catholic school).
What we as Westerners have to figure out is whether or not MOST of our ENEMIES who go by the name Muslims accept the Koran/Hadith as "divine truth" or whether it is a book on the mantle the way the Bible is for many Christians. This is the essence of our challenge. If most are not "devout," then we have nothing to worry about. If most are, then I suggest that the Koran and Hadith endorse violent subjugation and conversion, and that means that our war is indeed against Islam.