The greater tragedy is discrimination against Arabs based on racism and faulty heuristics for what a 'terrorist' looks like.
How relevant moderates are to extremism is a separate question (and one that is largely orthogonal to the religion itself) but it's fair to say that no matter how little a moderate has to do with extremists, someone who isn't even a member of their religion in the first place is about as undeserving of hostility as it gets.
I would argue the greater tragedies are that ethnicity frequently gets conflated with religion (which really serves no-one, unless your religion is incestuous) and that most people are too ignorant of other cultures than their own to tell them apart.
Heck, there are still Americans who have a hard time accepting that Obama isn't Muslim just because he's not white (as if non-white Christianity hadn't ever been a thing in the US).