Yeah, radical Islam of the sort that leads to random people getting killed is pretty much exclusively Sunni and Iranians are mainly Shia.
I'm not well versed enough to say categorically, but I'm pretty sure this is a gross simplification.
It's a simplification, but it's not gross, we have seen Shia terror, but it's quite different. First of all Shia terrorist tend to trained operative of organised armed groups (primarily Hezbollah) send their choice of target is not random restaurants or some random people. Mostly their target outside the Middle East have been Jews or Israelis. While in the Middle East they target members of the other "parties" in Lebanon (parties in Lebanon usual have their own armed forces, and most people would prefer fighting almost any Arab army over those parties militant wings, including Hezbollah who's terrified that the other parties unite against them, which is why Hezbollah is one of the few groups in the Middle East who downplay their strenght).
As for this shooting at least seven of the dead are from immigrant groups (3 Turks, 3 Kosovo Albanians, 1 Greek), while the eigth named victim was likely the child of Romanian German who had emigrated back to Germany, the ninth victim is unknown.
As for the racist term my guess is that it have likely been used in a in-group use like how the so called "N-word" is used by African Americans.
