So is Rudy stupid, or does he just think his potential supporters are?
I wouldn't go so far as to say "stupid". I think "mildly disinterested in exerting the effort necessary to absorb the truth" would be closer to the mark.
We were taught by the propaganda of the day (1979-1980) that President Carter was a wimp and that negotiations were no substitute for decisive (read: murderous) action. The fact that the hostages were released by virtue of negotiation rather than decisive (read:murderous) action - regardless of who was negotiating for what - flies in the face of the "accepted wisdom" and therefore must be discounted, even by the reasonably intelligent.
Ronald Reagan is still by far and away a more popular figure than
any of the current crop of Presidential candidates, especially among the elite Punditocracy. Hence the delusion.