This post brings several things to mind. Apparently, eastern Libya was a hugely overrepresented area among the international jihadis who went to Iraq and there exploded. Clearly, this means that you can't assume that they're fighting for democracy, whiskey, sexy.
However, it's also very likely that this represented a deliberate policy on the part of the Libyan government to channel its dissidents into particular ideologies that its new friends also perceived as the enemy, and then to ship them out of the country and hope they would explode somewhere else. Making jihadis - repressing all other forms of dissidence, while not trying too hard to stop them recruiting or leaving the country - had the side benefit that it validated their claim to be a bastion of stability assailed by Islamic extremism. They could produce the extremists, after all. And it further allowed them to avoid burning all their bridges with the other side. If it became expedient to make friends with the terrorists again, they could produce the bloody shirts - the martyrdom videos - and demonstrate that they had been useful.
Of course, Gadhafi didn't have to be an evil genius to come up with this plan - he was essentially copying Saudi Arabia's homework, and depending on how you look at the relationship between the Egyptian regime and the Brothers, perhaps sneaking a look at the neighbours' as well. Giddens may have thought they were going to be a new Norway, but the real plan was more like Saudi 2.0, probably right down to the hereditary government.
Another lesson from this is that they're probably not going to give up easily.