Muslim terrorists seem to often cite the Koran and jihad as a basis
for their actions. I would imagine that they are mis-interpreting
something or that there are some inconsistancies that they are taking
advantgae of but I dont know. What is it in the Koran that they use to
base their
actions and co-called jihad on?

Dear Randy, 

When it comes to religion, the name of te game is interpretations.
Christian history, for example, saw the establishment of the
Inquisition, according to interpertations of that time. Crusaders and
pogromists have also cited the Bible to justify their aims.

While being central to Islamic teachings, Jihad is not one of the Five
Pillars of Islam (http://en.wikipedia.org/wiki/Five_Pillars_of_Islam).
The term "Jihad" comes from "strive" or "effort" and is not
necessarily associated with violence. The article about Jihad on
Wikipedia provides some of the interpertations of Muslim scholars of
the term and when "Jihad" should be fought:
Permission for Jihad
<http://en.wikipedia.org/wiki/Jihad#Permission_for_Jihad> 

The modern Jihaddist movement is a modernist movement founded as a
response to modernity. Some of its main philosophers are Sayyid Qutb
and Hassan al Banna, founders of the Muslim Brotherhood, with their
strife to build a modern Sunni theocracy.
http://en.wikipedia.org/wiki/Sayyid_Qutb 
http://en.wikipedia.org/wiki/Hasan_al-Banna 

The Wikipedia article about Islamic Exteremism explains much about the
way that the term "Jihad" has been interpreted to mean violent
struggle against all those who are not "believers"
Ideology and theology
http://en.wikipedia.org/wiki/Islamic_extremist_terrorism#Ideology_and_theology

Therefore, this is not the Q'uran, this is actually really an
interopretation thereof. However, the Q'uran and the early Islamic
history is full with violent struggle to proselytise the new religion.
This is a tradition upon which the muslim extremists draw.

I hope this answers your question. Please contact me if you need any
clarification on this answer before you rate it.

Like Obi-won says, it's all comes down to your point of view. 
However, I think you can look at the Koran and decide if the radical
interpertation is reasonable or not.  US courts use such a standard
all the time for intperting contracts and such.   Quite Frankly, the
terrorists read the Koran literally.  Is that not a rational
intpretation assuming that it really is God's word handed to the
prophet by a messenger of god?

The really, really rational interpertation, of course, is that the
whole thing is bunk, just like every other religion.

Here's a scripture for Frank Corrao. 
1 Peter 3;3 For YOU know this first, that in the last days there will
come ridiculers with their ridicule, proceeding according to their own
desires 4 and saying: ?Where is this promised presence of his? Why,
from the day our forefathers fell asleep [in death], all things are
continuing exactly as from creation?s beginning.?

5 For, according to their wish, this fact escapes their notice, that
there were heavens from of old and an earth standing compactly out of
water and in the midst of water by the word of God; 6 and by those
[means] the world of that time suffered destruction when it was
deluged with water. 7 But by the same word the heavens and the earth
that are now are stored up for fire and are being reserved to the day
of judgment and of destruction of the ungodly men.

Your point of view will not save you.

Why is it that when a Muslim does something bad everyone blame it on
the religion and when a Jew or Christian does something bad only he or
she gets the blame? Why don't we look for an answer for our problems
rather than pointing the finger of blame at each other?