To what extent is the objection valid that the Hadith "I have been commanded to fight the people until they say 'There is no god but Allah'" contradicts the Prophet's statement to the people of Mecca, "Go, for you are free," and that this Hadith supports the notion of Islam spreading by the sword?

Islam did not spread by the sword; rather, it is the religion of truth that came for the happiness of people, and Muslims invite to it and teach it to people. Whoever obstructs the path of da'wah (invitation to Islam) is fought until he submits [to Islam] or surrenders to the authority of the Muslims, but he is not coerced into entering Islam thereafter. The statement that the Prophet, peace and blessings be upon him, did not order the people of Makkah to say "La ilaha illa Allah" (there is no god but Allah) is incorrect. Indeed, he was expelled and harmed because of his call to monotheism, but he did not coerce them into Islam as long as they did not prevent the transmission of the message.