The tragedy of Islam is that it is still stuck back where Christianity was when Galileo was under threat for saying that the Earth orbits the Sun. It has lacked a reformation. From being at the forefront of science, medicine, mathematics, art, and literature, the Islamic world has simply failed to innovate or discover for centuries.I imagine Muslims face the same dilemma as many Christians: fundamentalism has a certain logical coherence (modulo internal contradictions in the holy books), but it is patently absurd and morally abhorrent. On the other hand, a moderate stance (cherry picking from the holy books) puts you on a slippery slope: if that bit wasn't meant to be interpreted literally (or wasn't meant to apply to me), how can I be sure that this bit was?
I suspect Tebbit is right that 'innovation' is required for a religion to adapt to modernity, but it's hard to reconcile this flexibility with the authoritative commandments of an omniscient and timeless god.