1) The general interpretation/consensus on twitter etc seems to be that it's Mohammed saying "all is forgiven" to Charlie Hebdo, but when I first saw it I took it to be the magazine saying that all is forgiven to Mohammed as he/Islam is also Charlie Hebdo (in the sense that the killers were just rogue nutjobs and not representative of the religion as a whole). So it's both attacking and defending Islam at the same time. There's a high possibility this ambiguity is deliberate of course.
2) A lot of people seem to be going out of their way to directly offend Muslims who had nothing to do with the attacks by posting and retweeting the image with glee and some weird sense of pride - including many of the usual bed wetting lefty brigade. I find this 'hmm, interesting...'.
Not withstading point 2, if you haven't yet seen the front cover and you want to, here it is: http://i.huffpost.com/gen/2483520/thumbs/o-CHARLIE-COVER-570.jpg