That was a masterful use of selective quotation, nzcamel. If you look at Surah 9 once more, you may notice that 9:5 is bracketed between
9:4 "(But the treaties are) not dissolved with those Pagans with whom you have entered into alliance and who have not subsequently failed you in anything, nor aided any one against you. So fulfill your engagements with them to the end of their term, for Allah loves the righteous."
and
9:6 "If one amongst the Pagans ask you for asylum, grant it to him, so that he may hear the Word of Allah; and then escort him to where he can be secure. This is because they are men without knowledge."
Also, if you add in the rest of 9:5, picking up where your quote ends, "but if they repent, and establish regular prayers and practice regular charity, then open the way for them, for Allah is Oft-forgiving, Most Merciful."
As to 9:29, I believe it will be more entertaining if I respond in kind with a selective Bible quote.
Matthew 10:34"Think not that I am come to send peace on earth: I came not to send peace, but a sword. 10:35 For I am come to set a man at variance against his father, and the daughter against her mother, and the daughter in law against her mother in law."
You begin your post by asking "why can't it handle being challenged? If it's superior to Christianity and Judaism, why is it illegal under that same Shari'a law for people to convert from Islam to another religion?"
I would like to refer you to an excellent Wikipedia article
http://en.wikipedia.org/wiki/Thirty_Years_War
Among the highlights of Christianity's acceptance of religious challenges are
"...in some areas an estimated two-thirds of the population died. Germanys male population was reduced by almost half. The population of the Czech lands declined by a third. The Swedish armies alone destroyed 2,000 castles, 18,000 villages and 1,500 towns in Germany, one-third of all German towns."
Though the Thirty Years War certainly wasn't just about the Protestant-Catholic split, that was certainly the largest contributing factor.
Also associated with the Reformation are episodes of Protestant-Catholic fighting 1524-25 ended by the Diet of Speyer, 1546-55 ended by the Treaty of Augsburg, 1529-31 in Switzerland, 1562-98 in France (famous for the St. Bartholomew's Day Massacre of Protestants), 1560-1567 in Scotland, and I think we can safely add the Spanish Inquisition, blood libels, thousands of pogroms against Jews over centuries and the Crusades into Christianity's famously pacific nature.
The point I'm trying to make isn't that Christianity religion is inherently warlike, but that people invested with religious authority in all religions have a tendency to use their respective scriptures for political and military ends.
Now of course there isn't a verse in the Jewish Scriptures which Jewish people feel relates to Muhammad, but that wasn't my point. I was simply stating what Muslim theologians believe, not what Jewish or Christian theologians do. The main difference is that Muslims believe that the Prophets of the Jewish and Christian faiths were divinely inspired Prophets, but they do not believe Jesus was the Son of God. To return to Surah 9,
9:31 "They take their priests and their authorities to be their lords in derogation of Allah, and (they take as their Lord) Christ the son of Mary, yet they were commanded to worship but One God. There is no God but Him. Praise and glory to Him. (Far is He) from having the partners they associate (with Him).
P.S. It's difficult to communicate tone in writing, but I hope this doesn't come off as strident. I don't want to get involved in "which God is better" flame wars. There have been more than enough of those in the past 1400 years, often with literal flames.
