Holy War? Or War Against Crazies?

I am struggling with something. I really need help from commentary to clarify something.

So far the United States has not characterized the war against terrorists as a war against Islam. I understand the reasoning, I think. It is more rational that mere political correctness. If we declared the war to be against Islam, we would authorize the so-called moderate Muslims to take up arms against us. There are plenty of "moderate Muslims" who refuse to join in terrorism (although it seems to me they don't do nearly enough to report suspects and otherwise prevent terrorism -- at least that is made public). Declaring a war on Islam would likely convert moderates into combatants.

However, the nature of today's terrorism primarily arises from Islam. It is the Koran from which today's terrorists derive their inspiration and justification. Fundamentalists may arise from any mosque, no matter how moderate the mosque be in general. As long as Islam flourishes, believers will read the Koran and the Hadith (Sayings of Muhammad). Some will take the calls to "slay them (unbelievers) wherever you find them" literally.

So, what should we (the non-Muslim world) do? Should we acknowledge that Islam is the problem and fight Islam? Should be continue to try to isolate the violent from the non-violent, with precious little help from the latter? Is there a rational strategy and is the United States pursuing it?

I am looking for answers.