I'm not sure I agree with the argument that Islamic fundamentalism is in its death-throes. And I find the "Islam is really a religion of peace" argument used very disingenuously at times. While I can attest from my daily life here in Egypt that the great majority of Muslims have nothing extremist about them, the truth is that all religions contain a good dose of potential intolerance. What's true is, as Roy apparently writes, that "The key question is not what the Koran really says, but what Muslims say the Koran says." The Koran is an unescapable legitimizing reference point in Muslim debate, but it is used to argue very different points. If you read (Moroccan feminist Islamic scholar) Fatima Mernissi on the Koran, and you come away withe respect and fascination for a meaningful, multi-faceted text which contains the seed of some radical and inspiring ideas. Read some of the contemporary sheikhs handing out fatwas based on the Koran, and you come away thinking it's one great compendium of bigotry.
It's worth noting that Roy is French. The French may well end up being at the forefront of a movement to understand and integrate Islam into the West (10% of the population in France is Muslim). Europe in general is grappling with Islam in a much closer and I would say much more mature and nuanced way than America is. There are great perils ahead (racism on the part of Europeans, extremism on the part of immigrant Muslims) but if an educated, empowered Muslim community emergese in Europe they could have a real impact on world affairs and on their home countries.