not everyone who signs up as a terrorist immediately goes and blows himself up. Likewise, not everyone who signs up as a soldier immediately goes and gets killed on IED or in battle against terrorists.
My point is, from the standpoint of the rank-and-file, you can think of it as a job. A dangerous job, a job that may eventually involve either high risk activities (fighting) or even suicide missions, but that’s all in the future (and hey, heaven awaits). In the meantime, you sign up and all of a sudden you have got stuff to do. You have got friends and coworkers. You have a purpose in life. Maybe you even get money (not much for a Westerner, but for an unemployed guy from Mideast, you don’t need much).
The above might not apply to the “human missiles” like Palestinian suicide bombers, many of whom have blown themselves up shortly after being recruited. But for the real terrorists who are using them, they are just that, a cheap, stupid walking missile.
As for the larger purpose of terrorism as a form of jihad, I think there are various motivations. The motivation that IMHO has the biggest practical significance is not Bin Laden’s geopolitical theorizing but rather the assertion of the rights and privileges of Muslim minorities in Europe. The samurai asserted their rights and privileges against Japanese peasants by killing them for various slights. A minority of Muslims in Europe, with tacit support from the majority, is likewise terrorizing the majority around them to send a message that they are not to be messed with and that the government better run in circles around them to keep them happy, protect their sensitivities etc. That may suck for the individual terrorists involved (they may get imprisoned or killed) but it might be thought by big chunks of the community that it is for their collective good. Remember, no matter how many Pakistani men end up in British prisons for terrorism, there are many more Pakistanis waiting to immigrate, and what matters the most to the community is making sure that this process continues without a hitch. And so it will, because who wants to be the guy opposed to Muslim immigration? Some high profile opponents have already been killed, one of them in the Netherlands.
Oh, and another thing. We believe that Western armies and weapons can vanquish Muslims easily in conflict because that’s what our current strategic analysis indicates. Many/most Muslims believe that a number of hadiths have promised Muslims military victory over everybody else shortly before the end of the world. So for them this is like the Christian expectation of the Return of Jesus. Just like many Christians may be preparing for persecution of Christians, Rapture and similar, so many Muslims may be preparing for (and indeed beginning) that last war against the infidels. Just because the infidels are really strong now means nothing because if Allah has promised victory, Allah will deliver.