Saddam was certainly known to support the Hamas and the terrorist acts in Palestine. Something he didn't hide from anyone. Iraq was one big contributor money-wise to the Palestine cause. That is the extent of what is known on his support on terrorism.
I still think to this day, and my belief is now stronger than before that the attack on Iraq was a big strategic blunder. Iraq served for many years as an effective strategic ally for the western nations exactly because Saddam, the Baath party and most particularly the Sunnis were firm enemies of the Shias, which dominate Iran and other regional countries. That's why Iraq benefited for so long from western friendship. The country was an important agent against the spreading of a fundamentalist Islam. Saddam and the Sunnis he represents are sworn enemies of movements like Al Kaeda strongly supported by Iran. If we want to find supporters to the actions of Osama, look no further than Iran. Not Iraq! It was exactly this country that used to put them at bay. Hence the support it benefited for so many years from western countries.
Today the country is ravaged by what many people already consider, me included, a de facto civil war. Iran influence and strategic role in the region has never been bigger. That is the blunder. The big strategic error. Why do you think the first war against Iraq stopped at the doors of Baghdad? Who rules the region now? Who has the more power? Iran.
Iran, the Shias fundamentalist factions, and any other country or religious group who sees fit, now uses the UN unsanctioned war against Iraq as an excuse for spreading their anti-western creed. It even serves them well the current chaos in Iraq. Al Kaeda and similar groups certainly now also have an hand on some of the bombings on Iraq. The more the country is in chaos, the more the USA and England feel powerless to finish what they started, the more they feel they are right and the easier it is to them to gather new believers against the big "Satan".