To be fair, the reason for a lot of that is his schizophrenia, so cut him a bit of slack.
As a believer in causality and a bit of chaos, I think we are 100% product of our surrounding and in that all innocent in all behavior.
In my home country (germany) this is luckily somewhat founded in the legislative system. If I'm not mistaken nobody here will get punished for the sake of revenge, but just to protect society. No matter what you do, you deserve the right to live an OK life. If you are are a danger to society its safety might however stand above your freedom of movement.
It's all about prevention through detention and deterrence. I don't believe much in deterrence, but want to keep up the corrective of society and make no exception for the bad behavior of this guy. If I'd address him directly I would aim for a more diplomatic approach tough. In general I want to express that I'm very much against some of his views and found it difficult to promote his work without distancing myself from his behavior and criticizing it.
However, I like your vision even if I find it unrealistically utopian, and I upvoted you for the sentiment "No matter what you do, you deserve the right to live an OK life", which is curiously heartwarming.
About the unrealistic utopia: As said, some of this is fixed in the german law. I think there is a maximum of about 25 consecutive years of jail and of course no death sentence. More jail time is only lawful as detention to protect society for which you have to be diagnosed as mentally ill (highly likely to do very bad things again).
edit: actually 15 years is the german "for life" and you can't get 2x life-sentences at once, even for multiple offenses. There are just a few exceptions extending it to about 23-25 years. In the sentence that caused this law it says, that a human is nothing more than a wreck after 20 years and a longer sentence neither helps resocializing nor protecting the law and that the total psychological destruction would strip the affected of his basic human rights. (german source, no Idea how to deep-link: http://www.servat.unibe.ch/dfr/bv045187.html search for "Wissenschaftliche Untersuchungen" to find the passage)
Not excused, but allowances made. Unless somebody is an actual danger to others, if they exhibit some behaviour they have little or no conscious control over (such as is the case in schizophrenia, Tourette's, &c.), then they deserve at least some leeway. If it's possible for you to consciously work towards controlling such behaviour, then they deserve some leeway, just not as much. But regular assholes don't get a free pass in my book, though. Terry Davis has delusions he can't do much about, and that makes him different from somebody not dealing with schizophrenia, whose problem isn't due to delusions, but attitudes. This is an important difference, regardless of whether you consider free will to be a thing or not.
You might find this episode of the Rationally Speaking podcast interesting, as the guest aligns in some interesting ways with your point of view, and diverges in some even more interesting ones: http://rationallyspeakingpodcast.org/show/rs-163-gregg-carus...
I think it also makes sense to punish the rational criminal harder, because it actually might help, while the delusional person needs another kind of help.
I'm not sure how much you can do about your attitudes, I think freedom of will is an illusion. If you decide to turn your life around and become a good person, what made you do that? What made another one not do that? I think it's, as said, just the consequence of everything that ever happened before.
I sadly can't find the article anymore, in which it said that the illusion of a self and free will is important to stay the same person over time and that only than, someone can be held responsible for something and that society can only work if you have something to fear from doing wrong. In the article it was even mentioned to be proven by some simple evolutionary algorithm.
If I ever start working on an OS as more than a practice exercise, I will have to ask friends and family for an honest assessment of my sanity.