"If you think that Khan could have sold N Korea nuclear technology, and that al-Queda and other islamic groups could operate in Pakistan, totally over the opposition of the Pakistani establishment, then you're the one who's being silly. Sure, they'd never fully control the northwest tribal areas, but they could be doing a lot more."

So you thinking that Khan looked around world to sell his nuclear tecnology to, spotted the shithole called N Korea, and said here is a wonderful country to sell nuclear technology to?
Rather than N Korea, who is a client state of China which had nuclear technology for decades, having the nuclear technology and selling it to Pakistan [and Khan was working for Pakistan govt], which was in a war with India which was developing and did develop nuclear technology?

Who is silly?

As far as Pakistan doing more. You are aware that several attempt have been made at killing Musharraf. Do you realize that before 911, Musharraf was having problems with internal conflicts? And:
"Musharraf has had excellent personal relations with several sections of the US security establishement. Post his coup in 1999, President Clinton had called to protest and to be called back. Musharraf instead called General Anthony C. Zinni of the marines who was serving as the then head of CENTCOM (Middle East). Addressing him as "Tony", Musharraf continued on to explain his reasons and intended actions. General Zinni remained as one of Musharraf's strongest supporters prior to US foreign policy shifts post 9/11"
http://en.wikipedia.org/wiki/Pervez_Musharraf

"Musharraf has been reasonably helpful since 9/11, but clearly the Paks tolerated and possibly even encouraged a lot of nasty stuff prior to that, and even today there are plenty in the Army and ISI leadership whose sympathies lie more with bin-Laden than Bush."

Big deal. We have members of CIA who are opposed to Bush. In short there are no shortage of twits on this planet.

"If the nuclear transfers were a competely rogue operation by Khan, as you imply, with the government shocked, shocked to discover it, then why has he been treated so lightly, with so little information from he and his network being provided to the US?"

Did you notice what happenned in regards to Libya? Just because Musharraf is our ally doesn't mean he takes orders from us. Khan was regarded as national hero because PAKISTAN WERE IN A WAR WITH INDIA AND INDIA DEMONSTRATED A NUKE. And Pakistan was able later to also demonstrate it had nukes. They were talking about having nuclear war, not too long ago- btw this caused some concern here in the States.
ANYHOW. What were you saying? Not happy with how much Khan was punished? I'm sure Musharraff will take note of your displeasure.

"Also, was the Pakistani nuke OK because they hadn't signed the NPT? Would Iran thus be in the clear if they withdrew from it? "

Look, there is this idea that nuclear energy is a good thing with many benefits associated this technology in addition to merely providing energy. And there is some strange desire by some not to have every country or thug have access to nuclear bombs. So they married these to ideas together into a kind of compromise. The deal was that countries wanting nuclear technology, but not wanting to make bombs, could be legally sold the nuclear technology [and with this the relativity simple capablity to make nuclear bombs, but the deal was they agreed not to make nuclear weapons]. See everyone is happy?
Now, we don't want non-members of the treaty to make nuclear bombs, but we have bombs, and there could be real security issues which require a country to have nuclear weapons. If N Korea demonstrates it has a working nuke, then we probably would encourage Japan to build nukes [not that they would need encouraging].
Iran can not legally have nukes, Iran has no security need for nukes [it's not likely any potential enemy of Iran would use nukes [unless Iran used other WMD- or had nukes].