The extension of the term is unwarranted, and dilutes the meaning of fundamentalism. The extension to Islam is completely warranted, given the overlapping theological, historical and scriptural assumptions of Jews, Christians and Muslims.
I can certainly see the validity to these objections, what term would you recommend as an alternative?
It actually doesn't leave any room for interpretation if you think about it. By rendering the text infallible, it creates absolute certainty that the text has an actual meaning that does not vary over time. The only variance is the result of incorrect, fallible interpretations. Moreover, despite the twisting of reformers, the meaning is fairly clear in most areas.
If I was infallible, I could still speak in riddles and metaphors.