Emperor,
I agree with what you're saying. Islam is clearly a religion, not a race. And it's not so hard to make the distinction. Religion involves values and choice. But you can't choose your race. You can't choose your parents or your skin colour.

We should be able to critique religion when it falls foul of ethics, or for whatever reason. And this has been the problem in Victoria with some of its anti-discrimination legislation, which is so dull as to conflate race and religion. Those who wish to criticise Islam as an ideology have found themselves fronting up before the racial discrimination commissioner. I don't know if it's too far fetched to suggest that the Victorian government deliberately blurred the lines to try and pitch for the Muslim vote.

Language falls somewhere in between. One can sometimes choose a language to speak, but you don't get much choice about your mother tongue language.