I don't think F911 should win an Oscar for best documentary or best propaganda film of 2004.
I think one problem many people have with MM is that they don't know how to classify him or his work. In my mind, F911 is not a documentary because it is significantly interlaced with humor. I don't think there is a genre for "stand-up comedy" documentary. Documentaries try to inform you and persuade you with facts. F911 uses facts and humor to entertain and inform the audience.
MM is somewhat like a modern day Mark Twain or Will Rogers in his use of wit and humor, but most people don't think of him as a humorist, because his topics are so serious and political. (I wonder what MT or WR would be saying about current events...)
Is MM a propagandist? I don't think so. Modern day propagandists employ a wide ranging system using various media and approaches get a message across to the masses. Also, most people tend to associate propagandists with governments rather than with critics of the government.
MM is no more of a propaganist than Gary Trudeau, and I don't hear many people calling Doonesbury propaganda, though there are some I'm sure. GT is a comic strip writer, just a MM is a film maker. Both have their slant, but neither is a "propagandist" as most people use the word.
MM's work is quite satirical -- he wittily mixes footage of old Hollywood movies with modern day news to create his art (and its message). I don't think the public is used to seeing his brand of satire. I laughed my head off during the film when MM posed the question of what would have happened to Clinton if he had let the Saudis and bin Ladens leave in the days following 9/11...and then he shows a scene of a mob burning a witch.
My girlfriend surprised me on Friday evening with tickets to F911. We went to go see it in Arcata, California, the bastion of progressive politics in the USA (even more so than San Francisco). I thought it was a thought-provoking movie and I encourage everyone to see it. While I don't agree with everything MM says (the scenes of Iraq prior to the American invasion were way too idyllic), I think the message of the film is accurate and persuasive.