Actually I wanted to wait for marleya answering my query since I'd started this topic in reply to her views that "There is no compulsion in religion..." but since this topic has already received answers,I'll put in my two cents.I've referred to an article by Robert Spencer, coz I think if Marleya can use an Islamic website to answer my query, I can use articles by scholars who hold unfavorable views of Islam as well.However, to cross check, I have also used a link from an Islamic website.
BTW,

a.ghazali!
Many traditional Islamic theologians and Qur'an commentators argue that the violent verses of sura 9 abrogate more relatively tolerant material such as sura 109. When discussing why Muhammad didn't begin sura 9 with the customary invocation bismillah ar-rahman ar-rahim, in the name of Allah, the compassionate, the merciful, an intriguing answer comes from a Qur'an commentary that is still highly valued today in the Islamic world, Tafsir al-Jalalayn. This is a fifteenth-century work by the renowned imams Jalal al-Din Muhammad ibn Ahmad al-Mahalli (1389-1459) and Jalal al-Din Abd al-Rahman ibn Abi Bakr al-Suyuti (1445-1505). The invocation, suggests this tafsir, is security, and [Sura 9] was sent down when security was removed by the sword.
Security's removal by the sword meant specifically the end of many treaties the Muslims had made with non-Muslims. Another still-influential Qur'an commentator, Ibn Kathir (1301-1372) quotes an earlier authority, Ad-Dahhak bin Muzahim, to establish that the Verse of the Sword, sura 9:5 ("slay the unbelievers wherever you find them") abrogated every agreement of peace between the Prophet and any idolater, every treaty, and every term.? He adds from another authority: No idolater had any more treaty or promise of safety ever since Surah Baraah was revealed.And yet another early commentator, Ibn Juzayy (d. 1340) agrees that one of this verse?s functions is abrogating every peace treaty in the Qur?an.?
This idea is crucial as a guide to the relationship of the Quran's peaceful passages to its violent ones. Suras 16, 29, 52, 73, and 109 the sources of many of the Qur'an's verses of peace and tolerance are all Meccan. That means that many Muslims, guided by commentators such as those above and the imams who teach from them, see these suras only in light of what was revealed later in Medina. Being the last or next-to-last sura revealed, sura 9 is generally understood as being the Quran's last word on jihad, and all the rest of the book including the tolerance verses must be read in its light.
Ibn Kathir states this explicitly in his commentary on another tolerance verse And he [Muhammad] saith: O my Lord! Lo! these are a folk who believe not. Then bear with them (O Muhammad) and say: Peace. But they will come to know (Qur'an 43:88-89). The commentator explains that say Salam (peace!) means, do not respond to them in the same evil manner in which they address you; but try to soften their hearts and forgive them in word and deed. However, that is not the last word on the subject. As Ibn Kathir notes: But they will come to know. This is a warning from Allah for them. His punishment, which cannot be warded off, struck them, and His religion and His word was supreme. Subsequently Jihad and striving were prescribed until the people entered the religion of Allah in crowds, and Islam spread throughout the east and the west.
A modern-day Chief Justice of Saudi Arabia, Sheikh Abdullah bin Muhammad bin Humaid, has taught that in the Qur'an, at first the fighting was forbidden, then it was permitted and after that it was made obligatory. He also distinguishes two groups Muslims must fight: (1) against them who start the fighting against you (Muslims) . . . (2) and against all those who worship others along with Allah . . . as mentioned in Surat Al-Baqarah (II), Al-Imran (III) and At-Taubah (IX) . . . and other Surahs (Chapters of the Qur?an).? (The Roman numerals after the names of the chapters of the Quran are the numbers of the Suras: Sheikh Abdullah is referring to verses such as 2:216, 3:157-158, 9:5, and 9:29.)
This understanding of the Quran isn't limited to the Wahhabi sect, to which Sheikh Abdullah belongs. The Pakistani Brigadier S. K. Malik's 1979 book The Quranic Concept of War (a book that made its way to the American mujahedin Jeffrey Leon Battle and October Martinique Lewis, and which carried a glowing endorsement from Pakistan?s then-future President Muhammad Zia-ul-Haq, who said that it explained the ONLY pattern of warthat a Muslim country could legitimately wage) delineates the same stages in the Quranic teaching about jihad: The Muslim migration to Medina brought in its wake events and decisions of far-reaching significance and consequence for them. While in Mecca, they had neither been proclaimed an Ummah [community] nor were they granted the permission to take up arms against their oppressors. In Medina, a divine revelation proclaimed them an Ummah and granted them the permission to take up arms against their oppressors. The permission was soon afterwards converted into a divine command making war a religious obligation for the faithful.
This an answer from the Islamic website Sunnipath, regarding the principle of abrogation, it too suggests that the later verses ie the violent verses cancel out the peaceful ones.
http://qa.sunnipath.com/issue_view.asp?HD=7&ID=2656&CATE=1Thus according to the Quran, Muslim scholars throughout history upto the present date as well as various Islamist jihadists and "moderate" websites like Sunnipath-the Quranic verses preaching tolerance have been superceded by those preaching intolerance.
The problem with the principle of abrogation isn't that the revelations to Jews & Christians have been superceded-the problem is that according to Quranic principles, no idolater, Trinitarian or non believer can live in peace in Dar ul Islam, they have to convert or die, while Jews & non Trinitarian Christians have to pay the jizya & face many restrictions & humiliations in their life as a non Muslim in Dar ul Islam. Also, Muslims will constantly attempt to expand the periphery of Dar ul Islam into Dar ul Harb's lands-leading to much strife.