Re: The problem of Evil
-pares down emotional appeal-
God is omniscient, therefore He knows more than we do, and He can thus come up with/possess more reasons than the two you mentioned. If God were to somehow derive any sort of personal benefit from the existence of evil then he is evil. This covers any selfish reasons for allowing evil in the world that we do not know of.
If I were to give the benefit of the doubt to Islam then by extension I would also give the benefit of the doubt to all other religions that I know of. All major religions that have survived to the modern day also claim that they have intellectual basis. There is no possible way to distill a one true religion from this tangle. They could all be false, some could be true, some could be subsets of others, or even all of them are true.
Assuming that Islam is the one and only true religion, then there still lies certain problems. For example, there is a problem that exists inherently in codes of law that are flexible: if you can convince the other decisionmakers of the validity of a ruling regardless of whether you know it to be valid or not, then that becomes "right". The scholars claim that they have come up with the new rules due to revelations from God/extrapolations from the scripture. What if, God forbid, their interpretations are wrong? God has allowed for this margin of error in His laws. If He did intend Islam to be the one true way, why did he not lay down all the rules in the game of life in one go when he has omniscience to see into the future? This is a case of "able and not willing". Perhaps the believer is expected to err on the side of caution (true in the Christian religion IIRC; sin is when man decides to take a different path from God; i.e. you're expected to follow no matter what, even if you must follow blindly, so you are expected to exhibit undying faith or in other words, completely blind loyalty), but having to force us to take such risks is slightly indicative that God is not as benevolent as we would imagine.
I actually know what the term jihad meant when I used it; the contemporary use of the term is actually the lesser used term in Islam (seeing as they haven't done the "defend the nation/Islam" type of jihad for quite some time). I just went all the way since it was a jab that was attempting to expose the flaw of your argument in slightly inflammatory terms. I probably should have just put it down (and stole Khajmer's lines too) instead; I apologize for that rather inappropriate line.