Many people dont realize how much the various sects in Islam have affected much of the Muslim world. Historically wars have been fought between various groups all claiming to be Muslims.
Kuwait, much like the rest of the lands governed by Muslim rulers, know the threats of various sects and to avoid possible turmoils and revolting, have come up with many laws even in the past. Clearly this blasphemy law is one of them. Does anyone honestly believe this law is aimed at the regular Muslim man/woman? Nay, rather it's aimed at those who have some power and can pose a threat to the ruling family. Specially when you take into account the mentioning of those speaking ill about the Prophets's wives.
Anyone knows that in Islam belittling the Prophets companions is a huge sin ,but not considered blasphemy. And there are certain sects in Islam that actually think its obligatory to humiliate certain members of the Prophets family and friends. These sects have in the past brought down governments and caused turbulences. And it is them at whom these laws are aimed at.
The government of Kuwait are clearly trying to avoid any possible chances of trouble and have hence imposed this law. Now if anyone is to try anything against the government, squishing them will be made easy by implementation of this law.
So to say its killing in the name of God is certainly not the case here.