See Informed Comment.
The pope was trying to make the point that coercion of conscience is incompatible with genuine, reasoned faith. He used Islam as a symbol of the coercive demand for unreasoned faith.
But he has been misled by the medieval polemic on which he depended.
In fact, the Quran also urges reasoned faith and also forbids coercion in religion. The only violence urged in the Quran is in self-defense of the Muslim community against the attempts of the pagan Meccans to wipe it out.
Read the whole thing for a non-Muslim scholar's analysis.
Cole also suggests you read his collected postings on Quran and peace.
That is, if you care to change your mind. Something tells me that people who want to believe that Islam is evil, misguided and wrong, will never be convinced by reading the text of the Quran or the arguments of historians and scholars.