Considering that the US and France have done nothing substantive publicly in response to last week's riots (unless you count Nakula's arrest yesterday as a specific US govt response) AND riots didnt happen this week, it would seem that even the reaction to gross insults will eventually peter out...or get controlled.

Its the ruling elites in the middle east and Pakistan who need the modern world more than the modern world needs them (what will they do with their oil? drink it?). This bluff is bound to be called at some point, why not now? If Western nations tell them it can't be done and let them figure out how to pay off the DPC, after a few Fridays, they will figure it out. The elites who cannot figure out even this are not going to be salvageable anyway (its like a "stress test" for the elite..one that even Egypt seems to have passed and places like Saudi Arabia are in no trouble at all).
Whats the alternative? How will the US prevent individual jokers from making insulting videos in their kitchen and uploading them to youtube? I see no practical way in which it can be done. The thing to tell Ahmed Rashid or Kiyani is not "we are trying out best but Nakula wont listen and sadly we have no laws on the book to deal with him". Its to tell them that there is nothing that can be done about this and its best to just ignore it because in the end, it doesnt even matter. Islam wont disappear because some people make insulting remarks about it, just as Christianity or Mormonism or even scientology have not disappeared in spite of the best efforts of the Onion. Its a pointless fight. Sure, the mullahs will scream bloody murder. But either the elite has some way to control them or the elite is about ready to get bumped off anyway. The bottom line is, in most places, they will find a way.