I don't recall if Why Nations Fail specifically covered democracy, but at the very least, you can definitely see why nations caught in the vicious cycles it outlines might suffer more because of democracy.
> because the U.S. military does not aim to install democracy, it aims to install regimes that are friendly to U.S. military and business interests
No. The US military does not aim to install any regime, it aims to defeat the enemy's military. That's the big thing of what went so horribly wrong in Iraq: the US kept pushing military solution after military solution to fix very-non-military problems and was confused as to why it didn't work.