This is a wonderfully clear and concise article on the subject. Omid has captured the essential points in this ongoing debate and presents them here in a way that is easy to understand. Perhaps not the last word on the subject but sure to get a conversation started/continued. Please feel free to continue that conversation here by contributing a comment.
From the article:
There is a lovely story from the life of the Prophet Muhammad, remembering that a mysterious visitor came upon him and his companions. The visitor, later revealed to be the archangel Gabriel, proceeded to sit intimately next to Muhammad and quiz the Prophet. He asked Muhammad about three increasingly higher and deeper levels of religiosity, which the Prophet answered sequentially as Islam (wholehearted submission to God), Faith and, lastly, Loveliness (ihsan). This third quality the Prophet identified as worshipping God as if we could see the Divine, and if we cannot, to always remember that God nevertheless sees us.