Which situation would you prefer for Iraq?

[ag]

Option A would not have been that bad if it were possible to secure that it would lead to modern Turkey. It took Turkey 70 years to develop into something acceptable - there is no guarantee that if you came back to 1918 and restarted it would have been the same.  

Remember also that Ataturk was homegrown and earned his legitimacy by, first, salvaging national sovereignety on the battlefield: defeating Greek invasion in Asia Minor, expelling the Greeks, forcing the Great Powers to backtrack on the innitially agreed harsh near-dismemberment of the country.  Add to this also that Turkey, as it was left after the wars, had a clear religious and ethnic majority (nearly everyone was Sunni, and most people were Turkish), so the idea that "we are all Turks" was acceptable to most (not to Kurds, of course).  I am not sure that "we are all Iraqi" could be a similarly acceptable ideology in Iraq.

So, to make the parallel complete, the secular dictator would have to start by fighting the Kurds (expelling them from a bulk of their territory, letting the rest secede) and sternly requesting the departure of all the foreign troops. There is no way he can be "chosen" by foreigners - if he is ever perceived as such, he'd be dead before long. He would have to be credibly independent (verging on anti-American in the first decades). The regime would have to survive, largely unsupported from the outside, for a few decades (which would imply fairly savage harshness, not only to religious and ethnic, but also to ideological opponents).

The only way something like this  could happen is if some midrange Ba'athist officer takes control of the insurgency and manages to create a force capable of a) making the U.S. position on the ground untenable and b) taking over from any U.S.-installed government and subduing the religous and ethnic militias. Once in control of a sufficient chunk of the country he could negotiate (from the position of strength) a U.S. withdrawal (which would have to be sufficiently publically humiliating for the U.S. to make his independence credible).  He then would have to win in a rather bloody civil war with pretty much everyone. After this, if the Turkish parallel is to hold, you can expect a few decades of an unpleasant personal dictatorship (you should just hope he doesn't develop into a Saddam in the process - he, probably, will), followed by an uncertain transition to democracy interspersed with military coups and bloody suppressions of all sorts of rebellions, followed, may be, after many decades by something that might be called a secular democracy.

How likely would that sort of a scenario be? Not very likely, unfortunately. In fact, the U.S., probably, made even the first stage extremely unlikely by disbanding and dispersing the old Ba'athist army from which the new Father of All Iraqis could have emerged. Even if that were to happen, the chances of success are nearly negligible.

To sum up: the key in either scenario is governmental legitimacy. If you take away both the religious, ethnic and democratic sources of legitimacy, the only legitimacy possible seems to be military. And the only source of that is battlefield success against an outside enemy. The only candidates for the role of the defeated enemy I can see are the U.S. troups - and I doubt many of us would want to see them perform it.

[ag]

The Justice and Development Party (I think that's what they're called), did not win a landslide, while they hold a landslide in Parliament, this is due to Turkey's extremely idiotic electoral system which is proportional representation with a 10% threshhold.

You forget the reason for setting up this "ridiculous" system. This is the only way they can keep essentially Kurdish parties out of parliament. As it is, in "Kurdish" provinces some 70% of the vote normally goes to the parties that don't pass the national 10% threshold. Thus, the provinces get represented by local members of larger Turkish parties who get nearly no votes from their supposed constituencies.

Given the more fragmented ethnic/religious composition of Iraq, to avoid a strong representation of sectarian/ethnic parties one might have to set a national 25% threshold in any "eventually democratic" Iraqi state. Of course, that could, quite conceivably, result in a single-party parliament. Would that still be a democracy?