What did the Pope say that was so wrong? It isn't obvious to me
But naturally the emperor also knew the instructions, developed later and recorded in the Qur’an, concerning holy war. Without descending to details, such as the difference in treatment accorded to those who have the “Book” and the “infidels,” he turns to his interlocutor somewhat brusquely with the central question on the relationship between religion and violence in general, in these words:
Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached.
The emperor goes on to explain in detail the reasons why spreading the faith through violence is something unreasonable. Violence is incompatible with the nature of God and the nature of the soul.
God is not pleased by blood, and not acting reasonably is contrary to God's nature. Faith is born of the soul, not the body. Whoever would lead someone to faith needs the ability to speak well and to reason properly, without violence and threats... To convince a reasonable soul, one does not need a strong arm, or weapons of any kind, or any other means of threatening a person with death....
The decisive statement in this argument against violent conversion is this: not to act in accordance with reason is contrary to God's nature. The editor, Theodore Khoury, observes: "For the emperor, as a Byzantine shaped by Greek philosophy, this statement is self-evident. But for Muslim teaching, God is absolutely transcendent. His will is not bound up with any of our categories, even that of rationality." Here Khoury quotes a work of the noted French Islamist R. Arnaldez, who points out that Ibn Hazn went so far as to state that God is not bound even by his own word, and that nothing would oblige him to reveal the truth to us. Were it God's will, we would even have to practice idolatry. . . .
UPDATE: Dennis Prager has some interesting comments on what the Pope said and the reaction to it.