I'm going to be completely honest here: I am writing a paper and although I don't strictly need to know this to write the paper, it would help, and at this point I just really want to know because this is bothering me. If you're curious, the paper is about the administrative, cultural, and intellectual compromises made by the rulers of the Delhi Sultanate that allowed them to govern an overwhelmingly Hindu population while also trying to uphold the Shar'ia.
Ibn Qasim argued that "the idol-temple is similar to the churches of the Christians, to the synagogues of the Jews and to the fire-temples of the Zoroastrians", and the Hanafi legal school just accepted that reasoning?
That seems highly unlikely; the People of the Book are considered to be in submission to God not because their places of worship are similar, but because the prophet they follow received the same revelation as Muhammad. If anyone knows of any Islamic legal scholars who have made that claim regarding Hindus, that would be awesome too.
A liberal interpretation of Sura 2, Ayah 256, "Let there be no compulsion in religion" could justify the treatment of idolaters as people of the book without actually including them in that group, however I know of no point at which that Sura was actually invoked in support of the Brahmanabad Settlement.
You could argue that Albiruni's argument supports the Settlement, but Albiruni wouldn't publish his work on Indian culture and religion for another 300 years, so that's out too.
For the purposes of the paper, in theory I could just gloss over that like every one of the damn authors I'm reading did, but that is distasteful to me. Halp?
Why are you referencing "Hanafi" scholars? Abu Hanifa was 15 years old when ibn Qasim died.
I'm not sure where your quote from him comes from, but I don't see why it's unlikely. The Zoroastrians did not have a prophet who received the same revelation of Muhammed, but were allowed to pay the Jizya and thus granted a protected status, so there was a precedent of tolerance for non Christians/Jews/Sabeans/"Ahl al-Kitab"
The encylopedia of Islam entry on the conquest of Sindh notes that given that Hindus were the overwhelming majority of the population, and that the strict choice of the conquerors was to offer them Islam or death, that the conquerors simply demurred and chose the expedient option of not enforcing the stricture.
Much of the relevant information on this would probably be in Tabari, but I'm not in the library at the moment to look it up, and you might well discount it for being too late as well, like Biruni.
As a general point it's worth mentioning that in the first couple centuries of Islam the application of the law was so fluid, the Sunna so embryonic that, and the documentary sourcing so poor that the answer might not exist to your satisfaction.