Thanks for your views Agnostic.
It is very important to understand the relationships between various entities.
For example the Lal Masjid incident - I have always found it puzzling. That Masjid is right next to the ISI HQ. Not only that, they were allowed to do as they pleased for a long time. Only when they kidnapped the Chinese massage girls and China got angry did Musharraf decide to act.
They would not have been given all that leeway without some support from within the establishment. But still it is clear that the support was not from Musharraf himself. It seems they were being backed by a non-state network which might include serving personnel as well as retired personnel like Hamid Gul. And such a non-state network would need large resources which might come from the drugs trade.
As regards Haqqani - he is carrying out attacks on Americans in Afghanistan.
I'm sure he needs a lot of money and weapons. It would be interesting to see where they come from.
The Lal Masjid fiasco is explained in two words - "Political patronage". Abdul Aziz was in fact detained with weapons in his vehicle in Islamabad at one point, and was released on the intervention of the then Federal Minister, Ijaz-ul-Haq (Zia-ul-Haq's son), who was apparently close friends with him.
The Mullah' brother's father, who set up the mosque, was an influential maulana, and the mosque was one of strong repute. Mosques have traditionally enjoyed a sort of "Holy Cow" status, and an increasingly belligerent clergy has abused that respect through illegal construction, land grabs etc. I do not find it surprising that given the political connections of the founder and his sons and the reputation of the institution, that it stayed under the radar. This was also a time when the danger of the taliban was shared by very few in the establishment.
Haqqani may be attacking the US, and may have carried out the Embassy bombing, but not with Pakistani support, overt or covert. Our 'deals' with Nazir and Gul Bahadur (in whose territory Haqqani seems to operate out of) are pretty open and widely covered. Heck, we provided his men with artillery support when he led the Laskar against Uzbeks and other foreigners under Mehsud. The US knows this.
On his funding, I think the 500 million USD through drugs, and the weapons trade through the CAR's offers enough to go around.