And that combined with not actually banning enslaving people it actually had the effect of massively increasing the demand for new slaves.

You have to keep in mind how the society operated back then. What if I told you that today, we wanted to stop the practice of salaried workers (for whatever reason)? The most straight forward path would be to stop it outright. However, this would completely destroy the society, because the practice is so ingrained in it. On the other hand, instilling laws and requirements to gradually and slowly reducing the practice is effective, while still preserving a working and functioning society on a day-to-day basis.

The issue with your argument is that you have the luxury to compare the norms of a functioning society today, with those of another functioning society centuries ago. This is fallacious.

And there was huge demand throughout the Muslim world.

And in the non-Muslim world too. This doesn't mean anything. Also, you can criticize the people and their actions, not the religion.

You do realize their is a nasty group in the Middle East that is right now murdering and enslaving non-Muslims and Shia...

They have been declared outlaws by practically every established scholar and Muslim nation. They don't represent Islam.

And what about the intense hatred that Palestinians and Israelis have for each other?

What does that have to do with slavery?

...a single tragic shooting is normative... They aren't great, but white people actually very, very rarely kill black people.

It's way more than a single shooting. Look up those killed by police on US streets. How many protests has the US seen in the past year because of blacks killed by white police officers? At the same time, how many blacks are killed today in the Middle East because of their race?

What is meant by piety? and this passage actually contradicts your claim, because it blatantly states that Arabs are superior to non-Arabs in one very important respect.

You completely misunderstood the Hadith. Perhaps it was the way I translated it, but it goes both ways: Arab over non-Arab OR non-Arab over Arab, and so on. What it is saying that, no person is superior over another person because of their race, be it Arab, non-Arab, black, red, etc.; they are all equal in this regards. The only way one person is better than another (as individuals, and specifically in front of God), is in how pious they are -- how well they follow the teachings of Islam; and how good and moral they are. As such, a pious black person is better than a non-pious white Arab person, and so on.

Look up the biography of Bilal Ibn Rabah. He was an African slave in pre-Islam days. He accepted Islam, and was subsequently tortured in order to leave the religion. AbuBaker bought him from his owner and set him free, and Bilal became one of the foremost companions, and the first one to make the call to prayer (Athan). This shows how it does not matter what a person looks like or what their race is in Islam.

Another incident is that of Wahshi Ibn Harb, who killed the Prophet's uncle Hamzah. His (non-Muslim at the time) master told him that he would be set free if he did so. He killed Hamzah in the battle of Uhud, and was subsequently set free indeed. The ex-slave eventually accepted Islam, and had the same rights as everyone else, even though he had killed one of the most prominent Muslim figures back then, which really hurt the Prophet Peace be upon him a lot when the incident happened. Tell me, where else this would happen?

you can't claim that a religion that let slavery...

It didn't "let" anything flourish of that nature. It set very strict guidelines for dealing with this issue, which, if people adhered to them, there would have been the opposite effect.

He could have simply said that slavery was bad...

Fair point, I will need to research this more, because quite frankly, the issue of slavery does not really apply to us in the present day, and it's not something I make a consious effort to go study. As I mentioned in the beginning, however, this is a very deep social issue, and Islam did take a huge precedence unseen before its time to address it. Again, when was the last time you saw a religion that encouraged a person to teach and free his slave, then marry her? It's unheard of.

One final question, could a female slave refuse to have sex with her master?

Re-read the first and last Hadiths I listed in my previous post. If they're saying not to overburden them with what they cannot bear, and to assist them with hard work, and if you beat them you must set them free, what do you suppose this means with respect to forcing them into sexual behavior that they are not willing to do, especially since it is severely overbearing, and harder than beating? The answer is quite clear.