If we went to war in Iraq to fight terrorism, then we failed utterly at our ill-contrived mission. Going to war with Iraq only worsened the terrorist threat to America by giving them another place to dwell, and also by increasing the degree of anti-American sentiment around the world. This doesn't mean that Bush lied per se, but his administration made an obvious and not-so-subtle attempt to push the outlandish notion that a war with Iraq had something to do with fighting terrorists.
That said, I think Bush probably honestly believed his rhetoric as he didn't appear to have a solid understanding of the nation of Iraq prior to the invasion. Had he of studied up on the region, he would have been able to predict the outcome that we are now facing. I can't forget a sociology professor who's class I was taking at the time mentioning that Iraq was composed of three factions who were only being kept from a civil war by Saddam. Our nation was unprepared for what we now face, not because Bush outright lied, but because he failed to do his homework.