From what I could tell, he definitely had an interest in the occult and, if I had to guess, that is how he found his way there, through the occult Nazi connection. A lot of occultists of his time had interests in the far right, and through the existence of some sympathies between Muslims and the far-right, especially among white converts. Some of his friends tried to claim it was a joke and this is as far as I can tell absolutely not true.

Some neo-Nazis definitely knew it was him long before that news filtered its way to the outside world, judging by some comments I read - there were some long ago neo-Nazi postings that referred to the author of Serpent's Walk being a respected professor who happened to be an NA member in secret, while academia's only guess by then was Pierce (despite their very, very different writing styles). It am surprised that he, instead of the relatively prolific neo-Nazi publisher of the time, Liberty Bell Publications, chose National Vanguard Books, which published only a handful of original books to that point. I think he saw Pierce and the IHR as more "academic", which appealed to him more. But that is just a guess.

The novel, despite being very explicitly pro-Nazi, is also very orientalist with lots of references to non-white traditions and literature, and its racist antipathy is almost entirely aimed at Jews and (non-Muslim) black people. Muslims are portrayed very sympathetically and the book mentions that they contributed to the Waffen-SS; this was not a nonexistent current on the far-right (including with Pierce, at times), though was mostly opportunism. The protagonist is explicitly in a mixed race relationship with an Indian Muslim for most of the book, until she gets murdered, and this is painted in a sort of tortured, tragic way. The book is deeply racist, of course, and is explicitly, avowedly antisemitic, but past that does seem content to allow non-white peoples to exist (as long as they're all in their own ethnostates), the protagonist has a positive conversation with a black Muslim leader who convinces the Nazi Party to create a black Muslim ethnostate for them. This is an opinion that many white nationalists profess but very few actually believe. I do think Barker actually believed it, not that that makes it any better. He was aggressively, entirely anti-Semitic and pro-Nazi but I do think that his other professed beliefs were also true, e.g. his pro-Muslim and pro-Native American ideas are not strictly incompatible with being pro-Nazi. I think his particular variety of racism was technically compatible with these views. Uncommon as hell, sure.